Boston Scientific’s 2025 Surge: Can 2026 Match the Momentum?

Date of Call: Feb 4, 2026

Financials Results

• Revenue: $5.286 billion, up 15.9% YOY (14.3% operational growth)
• EPS: $0.80 per adjusted share, up 15% YOY
• Gross Margin: 70.7% in Q4; full year 2025 adjusted gross margin of 70.6%, up 30 basis points YOY
• Operating Margin: 27.3% in Q4; full year 2025 adjusted operating margin of 28.0%, up 100 basis points YOY

Guidance:

• Q1 2026 organic revenue growth expected to be 8.5% to 10%.
• Full year 2026 organic revenue growth expected to be 10% to 11%.
• Full year 2026 adjusted EPS expected to be $3.43 to $3.49, representing 12% to 14% growth.
• Expect adjusted operating margin expansion of 50 to 75 basis points in 2026.
• Full year 2026 free cash flow expected to be approximately $4.2 billion.

Business Commentary:

Revenue and Earnings Growth:

• Boston Scientific reported operational sales growth of 14% in Q4 and 19% for the full year 2025, with organic sales growth of 13% and 16%, respectively.
• Q4 adjusted EPS of $0.80 grew 15%, and full-year adjusted EPS of $3.06 grew 22%.
• This growth was driven by innovation, execution across business units, and strong performance in key areas like EP, WATCHMAN, and ICTx.

Regional Performance:

• The U.S. market grew 17% operationally in Q4 and 26% for the full year, with significant contributions from EP, WATCHMAN, and ICTx.
• The Asia Pacific region grew 15% operationally in Q4 and 14% for the full year, led by mid-teens growth in Japan and China.
• Growth in these regions was supported by strong product utilization, new approvals, and market expansion efforts.

WATCHMAN and EP Business Performance:

• The WATCHMAN business delivered 29% growth in Q4 and strong double-digit growth for the full year.
• EP business achieved 35% organic growth in Q4, driven by high PFA catheter utilization and mapping system placements.
• These performances were attributed to strong adoption of concomitant procedures and continued market share gains.

Challenges and Outlook:

• Urology sales grew 13% operationally but 3% organically for the full year, with expectations to return to market growth in 2026.
• Endoscopy experienced 8% organic growth in both Q4 and the full year, with a temporary impact from a product removal.
• The company anticipates continued growth across business units, supported by new product launches and strategic acquisitions like Valencia Technologies.

Sentiment Analysis:

Overall Tone: Positive

• "In 2025, we achieved over $20 billion in sales and for the second year in a row, delivered mid-teens growth, surpassing our financial goals... This outstanding and highly differentiated performance was fueled by innovation and execution..." "We expect our differentiated financial performance to continue and are guiding to organic growth of 8.5% to 10% for Q1 and 10% to 11% for the full year." "I'm extremely proud of our team and our performance in 2025."

Q&A:

• Question from Robert Marcus (JPMorgan Chase & Co): Concerns about U.S. EP and WATCHMAN performance in Q4 versus expectations and market, and expectations for 2026.
  Response: Management stated EP grew 35% in Q4, exceeding internal targets and outpacing competitors, with the U.S. market estimated at 18-20% growth. WATCHMAN grew 29% in Q4. Full-year EP market growth expected to be ~15% in 2026.

• Question from Larry Biegelsen (Wells Fargo Securities): Impact of recent trials on WATCHMAN and key endpoints for the CHAMPION trial.
  Response: No impact seen from recent trials; WATCHMAN uptake remains robust. CHAMPION trial has two co-primary endpoints: non-inferiority for combined stroke/systemic embolism/death, and superiority for bleeding.

• Question from Travis Steed (BofA Securities): Sequential flatness in U.S. EP and Q1 guide implications.
  Response: EP share loss expected due to new competitor entries; overall EP grew 35% in Q4. Q1 guide reflects tough comps and ~150 bps headwind from ACURATE discontinuation; expects stronger performance in second half.

• Question from Frederick Wise (Stifel, Nicolaus & Company): Cadence of EP growth in 2026 and implications of new products like FARAPOINT.
  Response: Expects EP market to grow ~15% in 2026, with Boston Scientific maintaining PFA market leadership. Growth drivers include geographic expansion, new product launches (e.g., FARAPOINT), and pipeline advancements.

• Question from Joanne Wuensch (Citigroup Inc.): Second-half accelerants and 2027 setup beyond EP and WATCHMAN.
  Response: Expects stronger performance across multiple business units in 2026, including PI, urology, neuromodulation, and CRM, alongside EP and WATCHMAN, supported by various new product launches and clinical data.

• Question from David Roman (Goldman Sachs Group): Diversification of growth drivers post-urology and endoscopy challenges.
  Response: Confidence in diversified growth; expects urology to return to market growth, neuromodulation to perform strongly, endoscopy to recover post-AXIOS issue, and ICTx to continue strong performance.

• Question from Patrick Wood (Morgan Stanley): Impact of sales force investments on vascular products like SEISMIQ and TCAR.
  Response: Commercial scale in PI and interventional cardiology is strong; Penumbra acquisition adds scaled sales force in new high-growth markets. Investments in R&D and tuck-in M&A continue to fuel growth in vascular areas.

• Question from Danielle Antalffy (UBS Investment Bank): EP lab capacity and market growth implications as efficiency gains from PFA devices plateau.
  Response: Efficiency gains from PFA are largely realized; expects EP market growth of ~15% in 2026, driven by ASC build-out, cath lab repurposing, and concomitant procedures to alleviate capacity constraints.

• Question from Michael Polark (Wolfe Research): Relationship between Siemens ICE catheter partnership and 2D ICE product plans.
  Response: Siemens partnership is for a premium 4D ICE catheter (differentiated, not yet available); 2D ICE will be a separate, established-market portfolio addition.

• Question from Matthew Taylor (Jefferies LLC): Potential for CHAMPION trial to show superiority and impact on concomitant procedures.
  Response: CHAMPION trial is powered for non-inferiority on stroke and superiority on bleeding. A positive result could strengthen current concomitant indication and drive long-term growth.

• Question from Joshua Jennings (TD Cowen): Confidence in long-range plan (LRP) targets through 2028.
  Response: Confidence unchanged; LRP goals of 10%+ organic revenue growth, 150 bps margin expansion, and strong double-digit EPS growth remain achievable, enhanced by Penumbra acquisition.

• Question from Christopher Pasquale (Nephron Research): Remaining PFA penetration in AF and expansion into other procedure categories like VT.
  Response: 70% PFA penetration in AF leaves 30% remaining; potential expansion into atrial tachycardias (though diminishing) and ventricular tachycardia, with ongoing studies for ventricular ablation.

Contradiction Point 1

WATCHMAN Market Growth Outlook

It involves a change in the projected annual growth rate for the WATCHMAN market, impacting investor expectations for this key business segment.

What caused the U.S. EP and WATCHMAN business to underperform expectations and the market this quarter, and how should concerns impact the 2026 outlook for these drivers? - Robert Marcus (JPMorgan)

2025Q4: The overall EP market growing ~15%... The 2026 guide reflects confidence in these businesses. - Michael Mahoney(CEO)

Is WATCHMAN a key growth driver, and how should growth and dollar contributions progress, particularly with the positive CHAMPION data? - Robert Marcus (JPMorgan Chase & Co)

2025Q3: The company expects the WATCHMAN market to grow approximately 20% annually over the long range... The 20% market CAGR projection is considered conservative. - Michael Mahoney(CEO)

Contradiction Point 2

EP Market Growth Projection

It presents conflicting statements on whether recent EP market performance meets or falls short of the long-term growth target, affecting the interpretation of market dynamics.

What factors caused the U.S. EP and WATCHMAN business to underperform expectations and the market in the quarter, and how does this affect the 2026 outlook for these key drivers? - Robert Marcus (JPMorgan)

2025Q4: EP growth of 35% exceeded internal targets, with the U.S. market estimated at 18-20% growth (not the 25% some competitors claimed). Boston Scientific gained share in EP despite new competition. - Michael Mahoney(CEO)

What percentage of AF ablations can transition to ASCs and how will this impact market growth? - Pito Chickering (Deutsche Bank AG)

2025Q3: The broader EP market remains early in its PFA adoption cycle, with significant growth still ahead. - Michael Mahoney(CEO) and Ken Stein(CMO)

Contradiction Point 3

U.S. EP Growth Outlook and Sequential Performance

It highlights a contradiction on EP sequential growth and future guidance, introducing uncertainty about the trajectory of this core business.

How did the U.S. EP share change amid RF competitors' growth, what factors shifted late in the quarter, and what does the Q1 guidance imply for EP in early 2026? - Travis Steed (BofA Securities)

2025Q4: U.S. EP was flat sequentially while RF competitors grew... The Q1 guide of 8.5-10% organic growth includes tough comps and ~150 bps headwind from the ACURATE discontinuation. - Michael Mahoney(CEO)

How should we think about the growth vectors for your EP business—market growth, PFA adoption, new geographies, and products—and its potential in 3 to 5 years, along with the impact of proposed ASC codes? - Lawrence Biegelsen (Wells Fargo)

2025Q2: EP growth is driven by... international adoption... The proposed ASC rule from CMS could be an advantage... More details will be shared at Investor Day. - Kenneth M. Stein(CMO)

Contradiction Point 4

EP Market Leadership and Competitive Moat

It contradicts the strength and sustainability of Boston Scientific's EP market leadership, which is fundamental to its competitive positioning.

What factors caused the U.S. EP and WATCHMAN businesses to underperform expectations in the quarter relative to market trends, and how should the 2026 outlook for these drivers be evaluated? - Robert Marcus (JPMorgan)

2025Q4: Boston Scientific gained share in EP despite new competition and expects to maintain PFA market leadership through 2026... - Michael Mahoney(CEO)

How does the ASC setting impact growth next year, particularly concomitant attachment rates if PFA moves to ASC, and is it still a net positive despite potentially lower WATCHMAN implants? - Frederick Wise (Stifel)

2025Q2: Strategy aims for category leadership across all aspects: indication expansion... Japan exemplifies this: despite being third to market without a persistent label, they are now the clear leader. - Kenneth M. Stein(CMO)

Contradiction Point 5

WATCHMAN Trial Impact Assessment

It involves contradictory statements on the impact of recent WATCHMAN trials on business performance, creating uncertainty about the franchise's growth drivers.

What impact did the three recent WATCHMAN trials (CLOSURE, ALONE-AF, OCEAN) have on the CHAMPION trial's endpoints and the importance of similar ischemic and hemorrhagic stroke rates? - Larry Biegelsen (Wells Fargo)

2025Q4: No impact from the recent WATCHMAN trials (CLOSURE, ALONE-AF, OCEAN) was seen, with WATCHMAN uptake remaining robust. - Ken Stein(Chief Medical Officer)

Can you explain WATCHMAN franchise growth, particularly concomitant procedures and new data? - Joanne Wuensch (Citi)

2025Q1: The positive uptake of WATCHMAN is faster than expected, driven by strong adoption of concomitant procedures with FARAPULSE, supported by clinical data (OPTION trial). - Mike Mahoney(CEO), Ken Stein(Chief Medical Officer)