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Week two of medtech earnings season sees Boston Scientific, Edwards Lifesciences and Intuitive Surgical report their first-quarter results. The reports will shed light on how major markets including pulsed field ablation (PFA), transcatheter aortic valve replacement (TAVR) and surgical robotics performed over the first three months of the year.
Abbott and Johnson & Johnson kicked off earnings season last week. Both companies predicted tariffs will cost them hundreds of millions of dollars this year. Tariff talk will continue in the second week, but the updates could also define trends and competitive dynamics in key markets.
1. Intuitive Surgical
J.P. Morgan analysts, in an April 14 note to clients, focused on the impact of tariffs on Intuitive ahead of the company’s earnings on Tuesday. The analysts said the company makes around 90% of its instruments and accessories in Mexico. Intuitive has avoided the worst case scenario so far, the analysts said, because reciprocal tariffs do not apply to Mexico. The U.S.-Mexico-Canada Agreement (USMCA) will shape the hit to Intuitive.
“The bad news is that as of April 2 the country is subject to [an approximately] 25% tariff with the exception of USMCA compliant goods,” the analysts wrote. Intuitive hasn’t commented yet regarding what percentage of its instruments and accessories produced in Mexico meet this criteria, they noted, “but we expect to hear more on the earnings call.”
Intuitive already does some instrument and accessory manufacturing in the U.S. The analysts speculated the company could move more production to U.S. sites.
The analysts were upbeat about other aspects of Intuitive’s business, predicting that the company will raise procedure growth guidance and that placements of its latest da Vinci 5 robot will remain strong.
2. Boston Scientific
Boston Scientific’s guidance assumed “some minor headwinds from potential tariffs,” BTIG analysts said in a note last week to investors. The company has said it “does not have meaningful levels of manufacturing or sourcing from Mexico, Canada or China,” the analysts said, suggesting it may be insulated from the worst of the current tariffs.
Investors will learn more when Boston Scientific reports its results Wednesday. PFA, a key growth driver, will be a focus. Needham analysts upgraded their rating on the company last week to “buy” after concluding the “threat of PFA competition appears less severe than we had previously anticipated.”