By the numbers
Q2 revenue: $6 billion
11.1% increase year over year
Net income: $884 million
7.2% increase year over year
Stryker expects a $175 million tariff impact on earnings in 2025, a slight decrease from the $200 million the company forecast in May. Stryker joins several medical device companies that have slashed tariff expectations, with several firms, including Johnson & Johnson and Boston Scientific, cutting the expected tariff hit by as much as half.
Stryker CFO Preston Wells said Thursday on an earnings call that the changes were a result of the U.S. and China agreeing to significantly reduce levies. However, Stryker did not cut its forecast by as much as other companies because the recent trade agreement with the European Union, which set a tariff rate of 15%, was more than the 10% Stryker had included in its previous model.
CEO Kevin Lobo said Stryker was impacted less than other companies due to its manufacturing footprint in Europe and having less of a presence in China than other medtech companies.
Raised earnings forecast
Stryker raised its financial forecast for the year, now expecting organic sales growth in a range of 9.5% to 10%, from a previous range of 8.5% to 9.5%. The company also raised its expectations for adjusted earnings per share by about 20 cents.
Lobo said the update was driven by continued procedural strength, including implants, and demand for capital equipment. Wells said initiatives Stryker started during the COVID-19 pandemic, such as pricing and manufacturing efficiency, have helped drive margin improvements.
Robot update
Stryker shared an update on planned launches for the company’s robots. In March, the company unveiled its latest orthopedic robot, the Mako 4. The Food and Drug Administration cleared the new system, but Stryker has not yet rolled out the robot globally, Lobo said.
The company has new hip revision and spine surgery applications that are only available on Mako 4. Stryker’s shoulder surgery application is currently on its Mako 3 robot, and is in the process of migrating to the newer robot, Lobo said. Because of that, the feature is still in a limited launch until next year.
Stryker reported a record quarter for Mako installations, although the company did not disclose the number of robots. The company reached a milestone of 2 million robotic procedures performed with Mako during the second quarter.
