Boston Scientific Outperforms Guidance, But Urology Growth Remains a Question

Date of Call: Feb 4, 2026

Financials Results

• Revenue: Q4 operational sales grew 14%, organic sales grew 13%, achieving high end of 11%-13% guidance. Full year operational sales grew 19%, organic sales grew 16%, exceeding guidance of ~15.5%.
• EPS: Q4 adjusted EPS of $0.80 grew 15%, exceeding guidance range of $0.77-$0.79. Full year adjusted EPS of $3.06 grew 22%, also exceeding guidance range of $3.02-$3.04.
• Gross Margin: Full year 2025 adjusted gross margin of 70.6%, representing a 30 basis point expansion versus full year 2024. 2026 full year adjusted gross margin expected roughly in line with 2025.
• Operating Margin: Full year 2025 adjusted operating margin of 28.0%, improving 100 basis points versus 2024. 2026 expected adjusted operating margin expansion of 50 to 75 basis points.

Guidance:

• Q1 2026 organic revenue growth expected in range of 8.5% to 10%.- Full year 2026 organic revenue growth expected in range of 10% to 11%.- Full year 2026 adjusted EPS expected in range of $3.43 to $3.49, representing 12% to 14% growth.- 2026 adjusted operating margin expected to expand 50 to 75 bps.

Business Commentary:

Revenue and Earnings Growth:

• Boston Scientific reported operational sales growth of 14% in Q4 2025 and 19% for the full year, with organic sales growth of 13% and 16% respectively.
• The growth was driven by innovation and execution across business units, including strong performances in EP, WATCHMAN, IO, endo, and ICTx.

EP and WATCHMAN Performance:

• The EP business showed 35% organic growth in Q4 2025, while WATCHMAN grew 29%.
• This was attributed to the adoption of PFA technology and concomitant procedures, with Boston Scientific gaining significant market share.

Guidance and Future Outlook:

• For 2026, Boston Scientific guided to organic growth of 8.5% to 10% for Q1 and 10% to 11% for the full year.
• The guidance reflects expectations of continued strong performance across business units and strategic acquisitions like Penumbra.

Regional Performance:

• The U.S. market grew 17% operationally in Q4 and 26% for the full year, while the Asia Pac region grew 15% operationally in Q4 and 14% for the full year.
• Growth was driven by strong performances in EP, WATCHMAN, and ICTx, particularly in Japan and China.

Challenges and Strategic Adjustments:

• Urology sales grew 13% operationally but 3% organically for the full year, with expectations to return to market growth in 2026.
• Challenges were due to supply chain issues and competitor integration, with plans to address them through new product launches and acquisitions.

Sentiment Analysis:

Overall Tone: Positive

• "We achieved over $20 billion in sales and for the second year in a row, delivered mid-teens growth, surpassing our financial goals." "We believe that our '26 guidance, along with our '26 to '28 goals... continue to be highly differentiated." "I'm extremely proud of our team and our performance in 2025."

Q&A:

• Question from Robert Marcus (JPMorgan Chase & Co): Regarding U.S. EP and WATCHMAN performance in the quarter versus expectations and market, and outlook for 2026.
  Response: EP grew 35% in Q4, exceeding internal target and outpacing competitors; market estimated at 18-20% growth. WATCHMAN grew 29% in Q4. Expect EP market to grow ~15% in 2026 and to outpace it.

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

• Question from Travis Steed (BofA Securities): Sequential change in U.S. EP and implications for Q1 guide.
  Response: EP share loss expected due to competitive launches; overall EP grew 35%. Q1 guide reflects tough comps and ~150 bps impact from ACURATE discontinuation; expects stronger comps in second half.

• Question from Frederick Wise (Stifel, Nicolaus & Company): Cadence of EP growth in 2026 and pipeline updates.
  Response: Expect EP market to grow 15% in 2026, with Boston Scientific aiming to maintain clear PFA market leadership and grow faster than market; geographic expansion and new product launches (e.g., FARAPOINT) are key drivers.

• Question from Joanne Wuensch (Citigroup Inc.): Second half accelerants beyond easing comps.
  Response: Expect stronger performance in multiple business units (PI, uro, neuromod, CRM) in 2026 versus 2025, contributing to overall growth.

• Question from David Roman (Goldman Sachs Group): Diversification of growth drivers post-urology and endoscopy challenges.
  Response: Confident in diversified growth across businesses; urology expected to return to market growth, neuromod to perform strongly, ICTx and IO businesses doing well.

• Question from Patrick Wood (Morgan Stanley): Impact of sales force build-out 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; ongoing organic R&D and tuck-in M&A fuel investments.

• Question from Danielle Antalffy (UBS Investment Bank): EP lab capacity and impact of CHAMPION on procedure waitlists.
  Response: Efficiency gains from PFA are now built into system; driving future growth will require building out ASCs and cath labs; CHAMPION could help but market growth capped at ~15%.

• Question from Michael Polark (Wolfe Research): Relationship between Siemens ICE partnership and 2D ICE product plans.
  Response: Siemens collaboration is for a premium 4D ICE product in development; 2D ICE would be a separate, established-market addition to portfolio.

• Question from Matthew Taylor (Jefferies LLC): Potential superiority in CHAMPION and impact on concomitant procedures.
  Response: CHAMPION is powered for non-inferiority on stroke and superiority on bleeding; a positive result would strengthen current indication and support long-term growth.

• Question from Joshua Jennings (TD Cowen): Confidence in 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 opportunities in AF and other procedures.
  Response: 70% AF penetration leaves 30% remaining; potential in atrial tachycardias and ventricular tachycardia, with studies ongoing for FARAPULSE in ventricles.

Contradiction Point 1

Watchman Growth Outlook and Tailwinds

Differing growth rate expectations and cited tailwinds for the WATCHMAN business.

How should we view the soft Q4 performance of U.S. EP and U.S. WATCHMAN in light of expected 25% EP market growth by 2026? - Robert Marcus (JPMorgan Chase & Co)

2025Q4: For 2026, the EP market is expected to grow ~15%, and Boston Scientific expects to outpace that. - Michael Mahoney(CEO)

Concerned about upcoming studies (ALONE-AF, OCEAN, CLOSURE-AF) impacting the 20% LRP market growth outlook for WATCHMAN and potential read-through to CHAMPION? - Larry Biegelsen (Wells Fargo Securities, LLC)

2025Q3: The 20% growth projection is seen as conservative given WATCHMAN's impact. - Ken Stein(Senior VP & Global Chief Medical Officer)

Contradiction Point 2

Impact of Procedure Capacity Constraints

Different assessments of the near-term impact of EP lab capacity constraints on market growth.

Given PFA efficiency gains are fully realized and EP labs face capacity constraints, what is the realistic EP market growth outlook, and how might this affect overall market growth? - Danielle Antalffy (UBS Investment Bank)

2025Q4: Growth will depend on building out Ambulatory Surgical Centers (ASCs), repurposing cath labs, and driving procedural efficiency... The 15% EP market growth expectation for 2026 is considered more realistic than higher figures, factoring in capacity constraints. - Ken Stein(Senior VP & Global Chief Medical Officer)

What proportion of AF ablations could shift to ASCs with new reimbursement, and how will this impact market growth? - Pito Chickering (Deutsche Bank AG)

2025Q3: ASCs are important for long-term volume capacity... The minimal impact in 2026 is expected. - Michael Mahoney(CEO) & Ken Stein(Senior VP & Global Chief Medical Officer)

Contradiction Point 3

Watchman Trial Impact Assessment

Contradiction on whether recent negative trials affected WATCHMAN performance.

Can you confirm there's no impact from the CLOSURE, ALONE-AF, and OCEAN trials on WATCHMAN? For the CHAMPION trial, what endpoints will physicians prioritize, and how significant are similar ischemic and hemorrhagic stroke rates compared to the OPTION trial? - Larry Biegelsen (Wells Fargo Securities)

2025Q4: There is no discernible impact from the three negative trials on WATCHMAN's performance, as evidenced by strong reported numbers. - Ken Stein(Senior VP & Global Chief Medical Officer)

Can you detail the reasons for WATCHMAN's over 20% growth, concomitant procedures, and additional data? - Joanne Wuensch (Citigroup)

2025Q1: The OPTION trial data is being well-digested... Clinical data from the OPTION trial is being well-digested. - Ken Stein(Senior VP & Global Chief Medical Officer)

Contradiction Point 4

EP Market Growth Expectation

Contradiction on the expected growth rate for the EP market in 2026.

What drove the softness in U.S. EP and U.S. WATCHMAN performance versus expectations and the market, and how should these key growth drivers be viewed for 2026 given 25% expected EP market growth? - Robert Marcus (JPMorgan Chase & Co)

2025Q4: For 2026, the EP market is expected to grow ~15%, and Boston Scientific expects to outpace that. - Michael Mahoney(CEO)

How to view the EP business's key growth vectors and proposed ASC codes over 3-5 years? - Lawrence H. Biegelsen (Wells Fargo)

2025Q2: Growth is driven by continued U.S. market growth, the safety/elegance of FARAWAVE... The proposed CMS ASC rule... would allow ablations in ASCs. - Kenneth Stein(Senior VP & Global Chief Medical Officer)

Contradiction Point 5

Watchman Growth Drivers and Future Outlook

Contradiction on the growth drivers and the expected growth rate for the WATCHMAN procedure.

Can you confirm no impact from the CLOSURE, ALONE-AF, and OCEAN trials on WATCHMAN, and clarify the key endpoints physicians will focus on in the CHAMPION trial (WATCHMAN FLX vs. OAC), particularly the importance of similar ischemic and hemorrhagic stroke rates compared to the OPTION trial? - Larry Biegelsen (Wells Fargo Securities)

2025Q4: There is no discernible impact from the three negative trials on WATCHMAN's performance, as evidenced by strong reported numbers. - Ken Stein(Senior VP & Global Chief Medical Officer)

What factors are driving the 30% U.S. and 28% global growth in WATCHMAN, and what are current expectations for 2026 expansion? - Robert Justin Marcus (JPMorgan)

2025Q2: The OPTION data and uptake of concomitant procedures (60% of EP implanters already doing them) are key drivers. The CHAMPION data will be presented in H1 2026. - Kenneth Stein(Senior VP & Global Chief Medical Officer)