Medtronic (MDT) Q2 2025 earnings summary

Executive summary

• Q2 FY25 revenue reached $8.4B, up 5.3% as reported and 5.0% organic year-over-year, marking the eighth consecutive quarter of mid-single-digit growth, driven by strong performance in Diabetes, Neuroscience, and Cardiovascular portfolios.

• GAAP net income was $1.27B (up 40% year-over-year); GAAP diluted EPS $0.99 (up 46%). Non-GAAP net income was $1.62B (down 3%); non-GAAP diluted EPS $1.26 (up 1% as reported, up 8% constant currency).

• Raised FY25 organic revenue growth guidance to 4.75%-5% and non-GAAP EPS guidance to $5.44-$5.50, reflecting continued innovation momentum and robust product pipeline.

• Innovation and product launches in TAVR, PFA, leadless pacemakers, diabetes, spine, and neuromodulation are driving diversified growth.

• Focused on cost productivity, pricing discipline, and investment in high-growth areas to sustain performance and long-term shareholder value.

Financial highlights

• Q2 FY25 revenue: $8.4B, up from $8.0B prior year; six-month sales reached $16.3B, up from $15.7B.

• Adjusted (non-GAAP) EPS was $1.26, up 8% constant currency and $0.01 above guidance midpoint; GAAP EPS was $0.99, up 46%.

• Adjusted gross margin was 65.2% (down 70 bps, up 40 bps constant currency); GAAP gross margin was 64.9%.

• Adjusted operating margin was 24.3% (down 90 bps, up 100 bps constant currency); GAAP operating margin was 19.0%.

• Free cash flow for the first six months was $1.02B, up from $721M year-over-year; operating cash flow for six months was $1.94B.

Outlook and guidance

• FY25 organic revenue growth guidance raised to 4.75%-5% (prior: 4.5%-5%).

• FY25 non-GAAP diluted EPS guidance increased to $5.44-$5.50, representing 4.6%-5.8% growth.

• Q3 organic revenue growth expected at ~4.75%; Q3 EPS guidance $1.35-$1.37.

• High single-digit constant currency adjusted EPS growth expected in the back half of FY25.

• FX expected to be a $225M-$325M headwind for FY25.