Press Release: Medtronic reports third quarter fiscal 2025 financial results

Dow Jones
02-18

Medtronic reports third quarter fiscal 2025 financial results

PR Newswire

GALWAY, Ireland, Feb. 18, 2025

Delivering durable revenue growth with strong earnings power; strength in Pulsed Field Ablation, Pacing, Structural Heart, Diabetes, and Neuromodulation

GALWAY, Ireland, Feb. 18, 2025 /PRNewswire/ -- Medtronic plc $(MDT)$ today announced financial results for its third quarter (Q3) of fiscal year 2025 (FY25), which ended January 24, 2025.

Key Highlights

   -- Revenue of $8.3 billion increased 2.5% as reported and 4.1% organic 
 
   -- GAAP diluted EPS of $1.01 increased 2%; non-GAAP diluted EPS of $1.39 
      increased 7% 
 
   -- Company reiterates full year revenue and EPS guidance 
 
   -- Cardiac Ablation Solutions revenue increased low-20s on strength of 
      pulsed field ablation (PFA) products 
 
   -- U.S. Centers for Medicare and Medicaid $(CMS)$ announced coverage for Renal 
      Denervation for the treatment of Hypertension expected to become final on 
      or before October 11, 2025 

Financial Results

Medtronic reported Q3 worldwide revenue of $8.292 billion, an increase of 2.5% as reported and 4.1% on an organic basis. Organic revenue growth comparison excludes:

   -- Other revenue of $32 million in the current year and $53 million in the 
      prior year; and 
 
   -- Foreign currency translation of -$103 million on the remaining segments. 

As reported, Q3 GAAP net income and diluted earnings per share (EPS) were $1.294 billion and $1.01, respectively, representing a decrease of 2% and an increase of 2%, respectively. As detailed in the financial schedules included at the end of this release, Q3 non-GAAP net income and non-GAAP diluted EPS were $1.787 billion and $1.39, respectively, representing increases of 3% and 7%, respectively.

"We delivered strong earnings this quarter, with significant improvements in both our gross margin and operating margin on the back of our ninth quarter in a row of mid-single digit organic revenue growth, " said Geoff Martha, Medtronic chairman and chief executive officer. "We are starting to see the results from our long term investments in groundbreaking innovation, such as pulsed field ablation, to drive growth in some of the most attractive markets in MedTech."

Cardiovascular Portfolio

The Cardiovascular Portfolio includes the Cardiac Rhythm & Heart Failure (CRHF), Structural Heart & Aortic $(SHA.AU)$, and Coronary & Peripheral Vascular $(CPV.AU)$ divisions. Revenue of $3.037 billion increased 3.7% as reported and 5.0% organic, with mid-single digit increases in CRHF and SH&A, and a low-single digit increase in CPV, all on an organic basis.

   -- CRHF results included mid-single digit growth in Cardiac Rhythm 
      Management, driven by low-double digit growth in Cardiac Pacing Therapies, 
      including mid-20s growth in Micra$(TM)$ transcatheter pacing systems; 
      Cardiac Ablation Solutions achieved low-20s growth on rapid adoption of 
      the PulseSelect(TM) and Affera(TM) Sphere-9(TM) PFA systems 
 
   -- SHA results driven by high-single digit Structural Heart growth, 
      excluding congenital, on the continued strength of the Evolut(TM) FX+ 
      TAVR system, and high-single digit growth in Cardiac Surgery 
 
   -- CPV growth driven by high-single digit growth in balloons and mid-single 
      digit growth in guide catheters and drug-coated balloons 
 
   -- Recent U.S. FDA approval for additional pulsed field ablation 
      manufacturing site in Galway; immediately boosts Affera(TM) supply 
 
   -- Expanded U.S. presence in fast-growing carotid market with exclusive 
      Contego Medical distribution agreement; includes recently FDA approved 
      carotid stenting system and option to acquire; Contego Medical running 
      clinical trial on next-generation transcarotid artery revascularization 
      (TCAR) system 
 
   -- Announced CMS opened a National Coverage Analysis $(NCA)$ on Renal 
      Denervation for the treatment of hypertension, with coverage expected to 
      become final on or before October 11, 2025 

Neuroscience Portfolio

The Neuroscience Portfolio includes the Cranial & Spinal Technologies $(CST)$, Specialty Therapies, and Neuromodulation divisions. Revenue of $2.458 billion increased 4.4% as reported and 5.2% organic, with a low-double digit increase in Neuromodulation, mid-single digit increase in CST, and low-single digit increase in Specialty Therapies, all on an organic basis.

   -- CST driven by high-single digit Neurosurgery growth on continued adoption 
      of the AiBLE(TM) ecosystem of enabling technology; CST in the U.S. grew 
      high-single digits, winning share 
 
   -- Specialty Therapies results driven by mid-single digit growth in Pelvic 
      Health on continued adoption of the InterStim X(TM) system; ENT grew 
      low-single digits on strength in PTeye(TM) capital and disposables; 
      Neurovascular, excluding China, grew mid-single digit with strength in 
      flow diversion 
 
   -- Neuromodulation above market performance driven by low-double digit Pain 
      Stim growth, including high-teens U.S. growth, on the continued launch of 
      the Inceptiv(TM) spinal cord stimulator; Brain Modulation grew mid-teens 
      globally and mid-twenties in the U.S. on the continued launch of the 
      Percept(TM) RC deep brain stimulator $(DBS)$ with BrainSense(TM) technology 
 
   -- Received CE Mark for BrainSense(TM) Adaptive Deep Brain Stimulation 
      (aDBS), a real-time closed-loop system 

Medical Surgical Portfolio

The Medical Surgical Portfolio includes the Surgical & Endoscopy (SE) and the Acute Care & Monitoring $(ACM)$ divisions. Revenue of $2.072 billion decreased 1.9% as reported and decreased 0.4% organic, with flat organic result in SE and low-single digit organic decline in ACM.

   -- SE results were affected by ongoing stapling segment pressures and a 
      transient change in U.S. distributor buying patterns, partially offset by 
      high-single digit growth in Emerging Markets and high-single digit growth 
      in Advanced Energy on continued adoption of LigaSure(TM) vessel sealing 
      technology 
 
   -- ACM performance included high-single digit declines in Nellcor(TM) blood 
      oxygen management products on a 30% year-over-year market decline in U.S. 
      respiratory-related hospitalizations in the quarter; this was partially 
      offset by high-single digit growth in Perioperative Complications 

Diabetes

Revenue of $694 million increased 8.4% as reported and 10.4% organic.

   -- U.S. revenue grew mid-single digits on the continued adoption of the 
      MiniMed(TM) 780G automated insulin delivery (AID) system, with an 
      increase in the MiniMed(TM) 780G installed base and strong CGM attachment 
      rates 
 
   -- International revenue grew low-double digits on increasing CGM attachment 
      as users upgrade to the Simplera Sync(TM) sensor 

Guidance

Medtronic today reiterated its revenue growth and EPS guidance for FY25.

The company continues to expect FY25 organic revenue growth in the range of 4.75% to 5%. The organic revenue growth guidance excludes the impact of foreign currency and revenue reported as Other. Including Other revenue and the impact of foreign currency exchange, if recent foreign currency exchange rates hold, FY25 revenue growth would be in the range of 3.4% to 3.8%.

The company continues to expect FY25 diluted non-GAAP EPS in the range of $5.44 to $5.50. This includes an estimated -5% impact from foreign currency exchange based on recent rates. The company's guidance represents FY25 diluted non-GAAP EPS growth in the range of 4.6% to 5.8%.

"EPS came in above the high end of our guidance range. We were pleased with the operational performance of the business this quarter, turning mid-single digit organic growth into leveraged earnings, highlighted by healthy gross margin improvement," said Gary Corona, Medtronic interim chief financial officer. "Looking ahead, our restored earnings power continues. We will accelerate both top and bottom line growth in Q4, resulting in high-single digit adjusted EPS growth in the back half of our fiscal year."

Video Webcast Information

Medtronic will host a video webcast today, February 18, at 8:00 a.m. EST (7:00 a.m. CST) to provide information about its businesses for the public, investors, analysts, and news media. This webcast can be accessed by clicking on the Events icon at investorrelations.medtronic.com, and this earnings release will be archived at news.medtronic.com. Within 24 hours of the webcast, a replay of the webcast and transcript of the company's prepared remarks will be available by clicking on the Events icon at investorrelations.medtronic.com.

Medtronic plans to report its FY25 fourth quarter results on Wednesday, May 21, 2025. For fiscal year 2026, Medtronic plans to report its first, second, third, and fourth quarter results on Tuesday, August 19, 2025, November 18, 2025, February 17, 2026, and Wednesday, May 20, 2026, respectively. Confirmation and additional details will be provided closer to the specific event.

Financial Schedules and Earnings Presentation

The third quarter financial schedules and non-GAAP reconciliations can be viewed by clicking on the Investor Events link at investorrelations.medtronic.com. To view a printable PDF of the financial schedules and non-GAAP reconciliations, click here. To view the third quarter earnings presentation, click here.

 
                                                                                 MEDTRONIC PLC 
                                                                             WORLD WIDE REVENUE(1) 
                                                                                  (Unaudited) 
 
                                                    THIRD QUARTER                                                                  YEAR-TO-DATE 
                     ---------------------------------------------------------------------------- 
                                REPORTED                                      ORGANIC                         REPORTED                                      ORGANIC 
                     ------------------------------                                                ------------------------------ 
                                                       Currency     Adjusted    Adjusted                                             Currency     Adjusted    Adjusted 
(in millions)           FY25        FY24     Growth    Impact(3)     FY25(4)     FY24(4)   Growth     FY25        FY24     Growth    Impact(3)     FY25(5)     FY24(5)   Growth 
                     ----------  ----------  ------  ------------  ----------  ----------  ------  ----------  ----------  ------  ------------  ----------  ----------  ------ 
Cardiovascular       $    3,037  $    2,929   3.7 %  $       (38)  $    3,075  $    2,929   5.0 %  $    9,145  $    8,702   5.1 %  $       (62)  $    9,207  $    8,702   5.8 % 
   Cardiac Rhythm & 
    Heart Failure         1,545       1,470     5.1          (18)       1,563       1,470     6.3       4,659       4,408     5.7          (26)       4,684       4,408     6.3 
   Structural Heart 
    & Aortic                874         843     3.7          (13)         887         843     5.2       2,610       2,475     5.4          (21)       2,631       2,475     6.3 
   Coronary & 
    Peripheral 
    Vascular                618         616     0.3           (8)         626         616     1.6       1,876       1,818     3.2          (15)       1,891       1,818     4.0 
Neuroscience              2,458       2,355     4.4          (21)       2,478       2,355     5.2       7,226       6,861     5.3          (29)       7,255       6,861     5.7 
   Cranial & Spinal 
    Technologies          1,250       1,204     3.8           (9)       1,259       1,204     4.6       3,632       3,465     4.8          (15)       3,646       3,465     5.2 
   Specialty 
    Therapies               732         726     0.8           (8)         740         726     1.9       2,181       2,126     2.6          (10)       2,191       2,126     3.1 
   Neuromodulation          476         425    12.0           (4)         480         425    12.9       1,413       1,270    11.2           (5)       1,417       1,270    11.6 
Medical Surgical          2,072       2,112   (1.9)          (32)       2,104       2,112   (0.4)       6,196       6,219   (0.4)          (50)       6,246       6,219     0.4 
   Surgical & 
    Endoscopy             1,596       1,616   (1.2)          (26)       1,622       1,616     0.4       4,790       4,803   (0.3)          (40)       4,829       4,803     0.5 
   Acute Care & 
    Monitoring              476         495   (3.9)           (5)         481         495   (2.8)       1,406       1,416   (0.7)          (10)       1,417       1,416      -- 
Diabetes                    694         640     8.4          (12)         706         640    10.4       2,027       1,829    10.8           (8)       2,035       1,829    11.3 
                     ----------  ----------          ------------  ----------  ----------          ----------  ----------          ------------  ----------  ---------- 
Total Reportable 
 Segments                 8,260       8,035     2.8         (103)       8,363       8,035     4.1      24,593      23,610     4.2         (149)      24,742      23,610     4.8 
Other(2)                     32          53  (41.1)           (1)          --          --      --          17         164  (89.9)           (3)          --          --      -- 
                     ----------  ----------          ------------  ----------  ----------          ----------  ----------          ------------  ----------  ---------- 
TOTAL                $    8,292  $    8,089   2.5 %   $     (104)  $    8,363  $    8,035   4.1 %  $   24,610  $   23,775   3.5 %   $     (152)  $   24,742  $   23,610   4.8 % 
                     ==========  ==========          ============  ==========  ==========          ==========  ==========          ============  ==========  ========== 
 
 
 
(1)  The data in this schedule has been intentionally rounded to the nearest 
     million and, therefore, may not sum. Percentages have been calculated 
     using actual, non-rounded figures and, therefore, may not recalculate 
     precisely. 
(2)  Includes historical operations and ongoing transition agreements from 
     businesses the Company has exited or divested, and specifically for the 
     three months ended July 26, 2024, impacting year-to-date figures, $90 
     million of incremental Italian payback accruals resulting from the two 
     July 22, 2024 rulings by the Constitutional Court of Italy relating to 
     certain prior years since 2015. 
(3)  The currency impact to revenue measures the change in revenue between 
     current and prior year periods using constant exchange rates. 
(4)  The three months ended January 24, 2025 excludes $71 million of revenue 
     adjustments related to $32 million of inorganic revenue for the 
     transition activity noted in (2) and $103 million of unfavorable currency 
     impact on the remaining segments. The three months ended January 26, 2024 
     excludes $53 million of inorganic revenue related to the transition 
     activity noted in (2). 
(5)  The nine months ended January 24, 2025 excludes $132 million of revenue 
     adjustments related to $90 million of incremental Italian payback 
     accruals further described in note (2), $106 million of inorganic revenue 
     related to the transition activity noted in (2), and $149 million of 
     unfavorable currency impact on the remaining segments. The nine months 
     ended January 26, 2024 excludes $164 million of inorganic revenue related 
     to the transition activity noted in (2). 
 
 
                                                                   MEDTRONIC PLC 
                                                                 U.S. REVENUE(1)(2) 
                                                                    (Unaudited) 
 
                                             THIRD QUARTER                                                    YEAR-TO-DATE 
                     -------------------------------------------------------------- 
                                REPORTED                        ORGANIC                         REPORTED                        ORGANIC 
                                                     ------------------------------  ------------------------------ 
                                                      Adjusted    Adjusted                                            Adjusted    Adjusted 
(in millions)           FY25        FY24     Growth     FY25        FY24     Growth     FY25        FY24     Growth     FY25        FY24     Growth 
                     ----------  ----------  ------  ----------  ----------  ------  ----------  ----------  ------  ----------  ----------  ------ 
Cardiovascular       $    1,405  $    1,373   2.4 %  $    1,405  $    1,373   2.4 %  $    4,242  $    4,149   2.2 %  $    4,242  $    4,149   2.2 % 
   Cardiac Rhythm & 
    Heart Failure           775         745     4.1         775         745     4.1       2,309       2,247     2.8       2,309       2,247     2.8 
   Structural Heart 
    & Aortic                372         363     2.6         372         363     2.6       1,129       1,087     3.9       1,129       1,087     3.9 
   Coronary & 
    Peripheral 
    Vascular                258         265   (2.8)         258         265   (2.8)         804         816   (1.4)         804         816   (1.4) 
Neuroscience              1,689       1,556     8.5       1,689       1,556     8.5       4,931       4,614     6.9       4,931       4,614     6.9 
   Cranial & Spinal 
    Technologies            943         875     7.8         943         875     7.8       2,724       2,560     6.4       2,724       2,560     6.4 
   Specialty 
    Therapies               419         407     3.0         419         407     3.0       1,235       1,202     2.7       1,235       1,202     2.7 
   Neuromodulation          327         275    19.0         327         275    19.0         972         852    14.1         972         852    14.1 
Medical Surgical            893         947   (5.8)         893         947   (5.8)       2,718       2,763   (1.6)       2,718       2,763   (1.6) 
   Surgical & 
    Endoscopy               623         663   (6.1)         623         663   (6.1)       1,928       1,971   (2.2)       1,928       1,971   (2.2) 
   Acute Care & 
    Monitoring              269         284   (5.1)         269         284   (5.1)         790         792   (0.2)         790         792   (0.2) 
Diabetes                    236         224     5.6         236         224     5.6         683         629     8.7         683         629     8.7 
                     ----------  ----------          ----------  ----------          ----------  ----------          ----------  ---------- 
Total Reportable 
 Segments                 4,223       4,100     3.0       4,223       4,100     3.0      12,573      12,154     3.4      12,573      12,154     3.4 
Other(3)                     15          20  (26.4)          --          --      --          51          65  (21.3)          --          --      -- 
                     ----------  ----------          ----------  ----------          ----------  ----------          ----------  ---------- 
TOTAL                $    4,237  $    4,120   2.8 %  $    4,223  $    4,100   3.0 %   $  12,624   $  12,219   3.3 %   $  12,573   $  12,154   3.4 % 
                     ==========  ==========          ==========  ==========          ==========  ==========          ==========  ========== 
 
 
 
(1)  U.S. includes the United States and U.S. territories. 
(2)  The data in this schedule has been intentionally rounded to the nearest 
     million and, therefore, may not sum. Percentages have been calculated 
     using actual, non-rounded figures and, therefore, may not recalculate 
     precisely. 
(3)  Includes historical operations and ongoing transition agreements from 
     businesses the Company has exited or divested. 
 
 
                                                                                 MEDTRONIC PLC 
                                                                            INTERNATIONAL REVENUE(1) 
                                                                                   (Unaudited) 
 
                                                    THIRD QUARTER                                                                  YEAR-TO-DATE 
                                REPORTED                                      ORGANIC                         REPORTED                                       ORGANIC 
                     ------------------------------                ------------------------------  -------------------------------                ------------------------------ 
                                                       Currency     Adjusted    Adjusted                                              Currency     Adjusted    Adjusted 
(in millions)           FY25        FY24     Growth    Impact(3)     FY25(4)     FY24(4)   Growth     FY25        FY24     Growth     Impact(3)     FY25(5)     FY24(5)   Growth 
                     ----------  ----------  ------  ------------  ----------  ----------  ------  ----------  ----------  -------  ------------  ----------  ----------  ------ 
Cardiovascular       $    1,632  $    1,556   4.9 %  $       (38)  $    1,670  $    1,556   7.3 %  $    4,904  $    4,552    7.7 %  $       (62)  $    4,966  $    4,552   9.1 % 
   Cardiac Rhythm & 
    Heart Failure           770         726     6.1          (18)         788         726     8.6       2,350       2,161      8.7          (26)       2,376       2,161     9.9 
   Structural Heart 
    & Aortic                502         480     4.6          (13)         515         480     7.2       1,482       1,389      6.7          (21)       1,503       1,389     8.2 
   Coronary & 
    Peripheral 
    Vascular                360         350     2.6           (8)         368         350     4.9       1,072       1,002      7.0          (15)       1,087       1,002     8.5 
Neuroscience                769         799   (3.7)          (21)         790         799   (1.1)       2,295       2,248      2.1          (29)       2,324       2,248     3.4 
   Cranial & Spinal 
    Technologies            307         329   (6.7)           (9)         316         329   (3.9)         907         905      0.3          (15)         922         905     1.9 
   Specialty 
    Therapies               313         319   (2.0)           (8)         321         319     0.4         947         924      2.4          (10)         957         924     3.5 
   Neuromodulation          149         150   (0.7)           (4)         153         150     1.8         441         419      5.4           (5)         446         419     6.5 
Medical Surgical          1,180       1,164     1.3          (32)       1,211       1,164     4.0       3,478       3,456      0.6          (50)       3,528       3,456     2.1 
   Surgical & 
    Endoscopy               973         953     2.1          (26)         999         953     4.9       2,862       2,832      1.1          (40)       2,902       2,832     2.5 
   Acute Care & 
    Monitoring              206         211   (2.3)           (5)         212         211     0.2         616         624    (1.4)          (10)         626         624     0.3 
Diabetes                    457         416     9.9          (12)         470         416    12.9       1,344       1,200     12.0           (8)       1,351       1,200    12.6 
                     ----------  ----------          ------------  ----------  ----------          ----------  ----------           ------------  ----------  ---------- 
Total Reportable 
 Segments                 4,038       3,935     2.6         (103)       4,141       3,935     5.2      12,020      11,456      4.9         (149)      12,169      11,456     6.2 
Other(2)                     17          34  (49.8)           (1)          --          --      --        (35)          99  (134.8)           (3)          --          --      -- 
                     ----------  ----------          ------------  ----------  ----------          ----------  ----------           ------------  ----------  ---------- 
TOTAL                $    4,055  $    3,968   2.2 %   $     (104)  $    4,141  $    3,935   5.2 %   $  11,986   $  11,555    3.7 %   $     (152)   $  12,169   $  11,456   6.2 % 
                     ==========  ==========          ============  ==========  ==========          ==========  ==========           ============  ==========  ========== 
 
 
 
(1)  The data in this schedule has been intentionally rounded to the nearest 
     million and, therefore, may not sum. Percentages have been calculated 
     using actual, non-rounded figures and, therefore, may not recalculate 
     precisely. 
(2)  Includes historical operations and ongoing transition agreements from 
     businesses the Company has exited or divested, and specifically for the 
     three months ended July 26, 2024, impacting year-to-date figures, $90 
     million of incremental Italian payback accruals resulting from the two 
     July 22, 2024 rulings by the Constitutional Court of Italy relating to 
     certain prior years since 2015. 
(3)  The currency impact to revenue measures the change in revenue between 
     current and prior year periods using constant exchange rates. 
(4)  The three months ended January 24, 2025 excludes $86 million of revenue 
     adjustments related to $17 million of inorganic revenue for the 
     transition activity noted in (2), and $103 million of unfavorable 
     currency impact on the remaining segments. The three months ended January 
     26, 2024 excludes $34 million of inorganic revenue related to the 
     transition activity noted in (2). 
(5)  The nine months ended January 24, 2025 excludes $183 million of revenue 
     adjustments related to $90 million of incremental Italian payback 
     accruals further described in note (2), $55 million of inorganic revenue 
     related to the transition activity noted in (2), and $149 million of 
     unfavorable currency impact on the remaining segments. The nine months 
     ended January 26, 2024 excludes $99 million of inorganic revenue related 
     to the transition activity noted in (2). 
 
 
                                       MEDTRONIC PLC 
                              CONSOLIDATED STATEMENTS OF INCOME 
                                         (Unaudited) 
 
                           Three months ended                    Nine months ended 
                  ------------------------------------ 
(in millions, 
except per share     January 24,        January 26,        January 24,        January 26, 
data)                    2025               2024               2025               2024 
                  -----------------  -----------------  -----------------  ----------------- 
Net sales         $           8,292  $           8,089   $         24,610   $         23,775 
Costs and 
expenses: 
 Cost of 
  products sold, 
  excluding 
  amortization 
  of intangible 
  assets                      2,779              2,782              8,485              8,172 
 Research and 
  development 
  expense                       675                695              2,048              2,060 
 Selling, 
  general, and 
  administrative 
  expense                     2,717              2,673              8,129              7,971 
 Amortization of 
  intangible 
  assets                        416                419              1,243              1,274 
 Restructuring 
  charges, net                   43                 20                120                114 
 Certain 
  litigation 
  charges, net                   22                 --                104                105 
 Other operating 
  (income) 
  expense, net                  (5)                 17               (38)               (13) 
                  -----------------  -----------------  -----------------  ----------------- 
Operating profit              1,646              1,483              4,519              4,091 
 Other 
  non-operating 
  income, net                  (72)              (177)              (403)              (407) 
 Interest 
  expense, net                  179                188                555                517 
                  -----------------  -----------------  -----------------  ----------------- 
Income before 
 income taxes                 1,540              1,472              4,367              3,982 
Income tax 
 provision                      237                135                737                936 
                  -----------------  -----------------  -----------------  ----------------- 
Net income                    1,303              1,337              3,630              3,045 
Net income 
 attributable to 
 noncontrolling 
 interests                      (9)               (15)               (24)               (23) 
                  -----------------  -----------------  -----------------  ----------------- 
Net income 
 attributable to 
 Medtronic        $           1,294  $           1,322  $           3,606  $           3,022 
                  =================  =================  =================  ================= 
Basic earnings 
 per share             $       1.01       $       0.99       $       2.80       $       2.27 
                  =================  =================  =================  ================= 
Diluted earnings 
 per share             $       1.01       $       0.99       $       2.79       $       2.27 
                  =================  =================  =================  ================= 
Basic weighted 
 average shares 
 outstanding                1,282.4            1,329.7            1,286.7            1,330.1 
Diluted weighted 
 average shares 
 outstanding                1,286.2            1,331.7            1,290.6            1,332.4 
 
 
 
The data in the schedule above has been intentionally rounded to the nearest 
million. 
 
 
                                                     MEDTRONIC PLC 
                                          GAAP TO NON-GAAP RECONCILIATIONS(1) 
                                                      (Unaudited) 
 
                                                     Three months ended January 24, 2025 
                                                                           Income     Net Income 
                                Cost of    Gross               Operating    Before   attributable 
(in millions, except     Net    Products  Margin   Operating     Profit     Income        to        Diluted   Effective 
per share data)         Sales     Sold    Percent    Profit     Percent     Taxes     Medtronic       EPS      Tax Rate 
                       -------  --------  -------  ----------  ---------  ---------  ------------  ---------  --------- 
GAAP                   $ 8,292  $  2,779   66.5 %  $    1,646     19.9 %  $   1,540  $      1,294  $    1.01     15.4 % 
Non-GAAP Adjustments: 
 Amortization of 
  intangible assets         --        --       --         416        5.0        416           339       0.26       18.5 
 Restructuring and 
  associated 
  costs(2)                  --       (4)       --          46        0.6         46            37       0.03       19.6 
 Acquisition and 
  divestiture-related 
  items(3)                  --       (1)       --          28        0.3         28            23       0.02       17.9 
 Certain litigation 
  charges, net              --        --       --          22        0.3         22            18       0.01       22.7 
 (Gain)/loss on 
  minority 
  investments(4)            --        --       --          --         --         68            52       0.04       22.1 
 Medical device 
  regulations(5)            --       (8)      0.1          11        0.1         11             9       0.01       18.2 
 Certain tax 
  adjustments, net          --        --       --          --         --         --            15       0.01         -- 
                       -------  --------  -------  ----------  ---------  ---------  ------------  --------- 
Non-GAAP               $ 8,292  $  2,766   66.6 %  $    2,169     26.2 %  $   2,130  $      1,787  $    1.39     15.7 % 
                                                                          =========  ============ 
 Currency impact           104        61    (0.3)         (4)      (0.4)                              (0.01) 
                       -------  --------  -------  ----------  ---------                           --------- 
Currency Adjusted      $ 8,396  $  2,827   66.3 %  $    2,165     25.8 %                           $    1.38 
                       =======  ========  =======  ==========  =========                           ========= 
 
                                                     Three months ended January 26, 2024 
                                                                           Income     Net Income 
                                Cost of    Gross               Operating    Before   attributable 
(in millions, except     Net    Products  Margin   Operating     Profit     Income        to        Diluted   Effective 
per share data)         Sales     Sold    Percent    Profit     Percent     Taxes     Medtronic       EPS      Tax Rate 
                       -------  --------  -------  ----------  ---------  ---------  ------------  ---------  --------- 
GAAP                   $ 8,089  $  2,782   65.6 %  $    1,483     18.3 %  $   1,472  $      1,322  $    0.99      9.2 % 
Non-GAAP Adjustments: 
 Amortization of 
  intangible assets         --        --       --         419        5.2        419           354       0.27       15.5 
 Restructuring and 
  associated 
  costs(2)                  --      (12)      0.1          55        0.7         55            46       0.03       16.4 
 Acquisition and 
  divestiture-related 
  items(3)                  --      (12)      0.1          58        0.7         58            52       0.04       10.3 
 (Gain)/loss on 
  minority 
  investments(4)            --        --       --          --         --         24            24       0.02         -- 
 Medical device 
  regulations(5)            --      (18)      0.2          26        0.3         26            21       0.02       19.2 
 Certain tax 
  adjustments, 
  net(6)                    --        --       --          --         --         --          (92)     (0.07)         -- 
                       -------  --------  -------  ----------  ---------  ---------  ------------  --------- 
Non-GAAP               $ 8,089  $  2,740   66.1 %  $    2,042     25.2 %  $   2,055  $      1,728  $    1.30     15.2 % 
                       =======  ========  =======  ==========  =========  =========  ============  ========= 
 
 
 
See description of non-GAAP financial measures contained in the press release 
dated February 18, 2025. 
(1)  The data in this schedule has been intentionally rounded to the nearest 
     million or $0.01 for EPS figures, and, therefore, may not sum. 
(2)  Associated costs primarily include salaries and wages for employees 
     supporting the restructuring activities, consulting expenses, and asset 
     write-offs. 
(3)  The charges primarily include business combination costs, changes in fair 
     value of contingent consideration, and exit of business-related charges. 
(4)  We exclude unrealized and realized gains and losses on our minority 
     investments as we do not believe that these components of income or 
     expense have a direct correlation to our ongoing or future business 
     operations. 
(5)  The charges represent incremental costs of complying with the new 
     European Union (E.U.) medical device regulations for previously 
     registered products and primarily include charges for contractors 
     supporting the project and other direct third-party expenses. We consider 
     these costs to be duplicative of previously incurred costs and/or 
     one-time costs, which are limited to a specific time period. 
(6)  The net tax benefit primarily relates to a change in a Swiss Cantonal tax 
     rate associated with previously established deferred tax assets from 
     intercompany intellectual property transactions and the step up in tax 
     basis for Swiss Cantonal purposes. 
 
 
                                                      MEDTRONIC PLC 
                                            GAAP TO NON-GAAP RECONCILIATIONS(1) 
                                                        (Unaudited) 
 
                                                       Nine months ended January 24, 2025 
                                                                            Income 
                                 Cost of    Gross               Operating    Before     Net Income 
(in millions, except     Net     Products  Margin   Operating     Profit     Income    attributable    Diluted   Effective 
per share data)          Sales     Sold    Percent    Profit     Percent     Taxes     to Medtronic      EPS      Tax Rate 
                       --------  --------  -------  ----------  ---------  ---------  --------------  ---------  --------- 
GAAP                   $ 24,610  $  8,485   65.5 %  $    4,519     18.4 %  $   4,367  $        3,606  $    2.79     16.9 % 
Non-GAAP Adjustments: 
 Amortization of 
  intangible assets          --        --       --       1,243        4.9      1,243           1,017       0.79       18.3 
 Restructuring and 
  associated 
  costs(2)                   --      (24)      0.1         154        0.6        154             124       0.10       19.5 
 Acquisition and 
  divestiture-related 
  items(3)                   --      (17)       --          15        0.1         15               3         --       73.3 
 Certain litigation 
  charges, net               --        --       --         104        0.4        104              86       0.07       17.3 
 (Gain)/loss on 
  minority 
  investments(4)             --        --       --          --         --         41              14       0.01       61.0 
 Medical device 
  regulations(5)             --      (27)      0.1          38        0.2         38              30       0.02       21.1 
 Other(6)                    90        --      0.2          90        0.4         90              70       0.05       22.2 
 Certain tax 
  adjustments, 
  net(7)                     --        --       --          --         --         --              49       0.04         -- 
                       --------  --------  -------  ----------  ---------  ---------  --------------  --------- 
Non-GAAP               $ 24,700  $  8,417   65.9 %  $    6,162     24.9 %  $   6,051  $        4,999  $    3.87     17.0 % 
                                                                           =========  ============== 
 Currency impact            150      (72)      0.5         241        0.9                                  0.15 
                       --------  --------  -------  ----------  ---------                             --------- 
Currency Adjusted      $ 24,850  $  8,345   66.4 %  $    6,403     25.8 %                             $    4.02 
                       ========  ========  =======  ==========  =========                             ========= 
 
                                                       Nine months ended January 26, 2024 
                                                                            Income 
                                 Cost of    Gross               Operating    Before     Net Income 
(in millions, except     Net     Products  Margin   Operating     Profit     Income    attributable    Diluted   Effective 
per share data)          Sales     Sold    Percent    Profit     Percent     Taxes     to Medtronic      EPS      Tax Rate 
                       --------  --------  -------  ----------  ---------  ---------  --------------  ---------  --------- 
GAAP                   $ 23,775  $  8,172   65.6 %  $    4,091     17.2 %  $   3,982  $        3,022  $    2.27     23.5 % 
Non-GAAP Adjustments: 
 Amortization of 
  intangible assets          --        --       --       1,274        5.4      1,274           1,078       0.81       15.4 
 Restructuring and 
  associated 
  costs(2)                   --      (43)      0.2         237        1.0        237             198       0.15       16.5 
 Acquisition and 
  divestiture-related 
  items(3)                   --      (24)      0.1         165        0.7        165             149       0.11        9.7 
 Certain litigation 
  charges, net               --        --       --         105        0.4        105              81       0.06       22.9 
 (Gain)/loss on 
  minority 
  investments(4)             --        --       --          --         --        113             109       0.08        4.4 
 Medical device 
  regulations(5)             --      (60)      0.3          88        0.4         88              70       0.05       20.5 
 Certain tax 
  adjustments, 
  net(8)                     --        --       --          --         --         --             282       0.21         -- 
                       --------  --------  -------  ----------  ---------  ---------  --------------  --------- 
Non-GAAP               $ 23,775  $  8,046   66.2 %  $    5,961     25.1 %  $   5,965  $        4,988  $    3.74     16.0 % 
                       ========  ========  =======  ==========  =========  =========  ==============  ========= 
 
 
 
See description of non-GAAP financial measures contained in the press release 
dated February 18, 2025. 
(1)  The data in this schedule has been intentionally rounded to the nearest 
     million or $0.01 for EPS figures, and, therefore, may not sum. 
(2)  Associated costs primarily include salaries and wages for employees 
     supporting the restructuring activities, consulting expenses, and asset 
     write-offs. 
(3)  The charges primarily include business combination costs, changes in fair 
     value of contingent consideration, and exit of business-related charges. 
     The nine months ended January 24, 2025, also include gains related to 
     certain business or asset sales. 
(4)  We exclude unrealized and realized gains and losses on our minority 
     investments as we do not believe that these components of income or 
     expense have a direct correlation to our ongoing or future business 
     operations. 
(5)  The charges represent incremental costs of complying with the new 
     European Union (E.U.) medical device regulations for previously 
     registered products and primarily include charges for contractors 
     supporting the project and other direct third-party expenses. We consider 
     these costs to be duplicative of previously incurred costs and/or 
     one-time costs, which are limited to a specific time period. 
(6)  Reflects the recognition of incremental Italian payback accruals 
     resulting from the two July 22, 2024 rulings by the Constitutional Court 
     of Italy relating to certain prior years since 2015. 
(7)  Primarily relates to amortization of previously established deferred tax 
     assets from intercompany intellectual property transactions. 
(8)  The net charge primarily relates to an income tax reserve adjustment 
     associated with the June 2023, Israeli Central-Lod District Court 
     decision and the establishment of a valuation allowance against certain 
     net operating losses which were partially offset by a benefit from the 
     change in a Swiss Cantonal tax rate associated with previously 
     established deferred tax assets from intercompany intellectual property 
     transactions and the step up in tax basis for Swiss Cantonal purposes. 
 
 
                                                     MEDTRONIC PLC 
                                           GAAP TO NON-GAAP RECONCILIATIONS(1) 
                                                       (Unaudited) 
 
                                                      Three months ended January 24, 2025 
                       ------------------------------------------------------------------------------------------------- 
                                                                                                Other 
                                                                                              Operating 
                                                 SG&A                  R&D        Other       (Inc.)/Ex 
                                                Expense              Expense     Operating     p., net 
                                                as a %               as a %      (Income)     as a % of    Other Non- 
                                       SG&A     of Net      R&D      of Net      Expense,        Net        Operating 
(in millions)           Net Sales     Expense    Sales     Expense    Sales         net         Sales      Income, net 
                       -----------  ----------  -------  ----------  -------  --------------  ---------  --------------- 
GAAP                   $     8,292  $    2,717   32.8 %  $      675    8.1 %  $          (5)    (0.1) %  $          (72) 
Non-GAAP Adjustments: 
 Acquisition and 
  divestiture-related 
  items(2)                      --        (13)    (0.2)          --       --            (13)      (0.2)               -- 
 Medical device 
 regulations(3)                 --          --       --         (3)       --              --         --               -- 
 (Gain)/loss on 
  minority 
  investments(4)                --          --       --          --       --              --         --             (68) 
                       -----------  ----------  -------  ----------  -------  --------------  ---------  --------------- 
Non-GAAP               $     8,292  $    2,704   32.6 %  $      672    8.1 %   $        (18)    (0.2) %  $         (140) 
 
                                                      Nine months ended January 24, 2025 
                       ------------------------------------------------------------------------------------------------- 
                                                                                                Other 
                                                                                              Operating 
                                                 SG&A                  R&D        Other       (Inc.)/Ex 
                                                Expense              Expense     Operating     p., net 
                                                as a %               as a %      (Income)     as a % of    Other Non- 
                                       SG&A     of Net      R&D      of Net      Expense,        Net        Operating 
(in millions)           Net Sales     Expense    Sales     Expense    Sales         net         Sales      Income, net 
                       -----------  ----------  -------  ----------  -------  --------------  ---------  --------------- 
GAAP                    $   24,610  $    8,129   33.0 %   $   2,048    8.3 %   $        (38)    (0.2) %  $         (403) 
Non-GAAP Adjustments: 
 Restructuring and 
  associated 
  costs(5)                      --        (10)    (0.1)          --       --              --         --               -- 
 Acquisition and 
  divestiture-related 
  items(2)                      --        (40)    (0.3)          --       --              42        0.2               -- 
 Medical device 
 regulations(3)                 --          --       --        (10)       --              --         --               -- 
 Other(6)                       90          --       --          --       --              --         --               -- 
 (Gain)/loss on 
  minority 
  investments(4)                --          --       --          --       --              --         --             (41) 
                       -----------  ----------  -------  ----------  -------  --------------  ---------  --------------- 
Non-GAAP                $   24,700  $    8,078   32.7 %   $   2,038    8.3 %  $            4       -- %  $         (443) 
                       ===========  ==========  =======  ==========  =======  ==============  =========  =============== 
 
 
 
See description of non-GAAP financial measures contained in the press release 
dated February 18, 2025. 
(1)  The data in this schedule has been intentionally rounded to the nearest 
     million, and, therefore, may not sum. 
(2)  The charges primarily include business combination costs, changes in fair 
     value of contingent consideration, exit of business-related charges, and 
     gains related to certain business or asset sales. The nine months ended 
     January 24, 2025, also include gains related to certain business or asset 
     sales. 
(3)  The charges represent incremental costs of complying with the new 
     European Union medical device regulations for previously registered 
     products and primarily include charges for contractors supporting the 
     project and other direct third-party expenses. We consider these costs to 
     be duplicative of previously incurred costs and/or one-time costs, which 

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February 18, 2025 06:45 ET (11:45 GMT)

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