Medtronic 2026 Q2 Earnings Strong Performance as Net Income Grows 8.1%

Medtronic (MDT) exceeded expectations in its fiscal 2026 Q2 earnings, with revenue rising 6.6% and EPS increasing 8.1%. The company raised full-year revenue guidance to 5.5% growth, reflecting robust performance across key segments and sustained profitability.

Revenue

Medtronic’s total revenue reached $8.96 billion in Q2 2026, driven by a 6.6% year-over-year increase. The Cardiovascular segment led growth with $3.44 billion in revenue, fueled by strong procedure volumes and innovation in cardiac ablation. Neuroscience contributed $2.56 billion, while Medical Surgical added $2.17 billion. The Diabetes segment, set for a spinoff, generated $757 million, and other segments accounted for $35 million.

Earnings/Net Income

The company’s EPS surged to $1.07 in Q2 2026, a 8.1% increase from $0.99 in the prior year. Net income grew 8.1% to $1.38 billion, reflecting sustained profitability for 13 consecutive years. Medtronic’s consistent earnings growth and stable business performance underscore its financial strength.

Post-Earnings Price Action Review

The stock price of Medtronic edged up 0.83% in the latest trading day and climbed 5.66% during the most recent full trading week. Month-to-date gains reached 5.24%, aligning with the company’s positive earnings trends. A backtest of the strategy to buy shares after the earnings report and hold for 30 days showed cumulative returns of 21.8% over three years, with an average annual return of 7.3%. This suggests a robust holding strategy, though investors should remain mindful of valuation concerns and limited growth prospects highlighted by analysts.

CEO Commentary

CEO Geoffrey Martha emphasized Medtronic’s outperformance in Q2, citing robust procedure volumes and innovation in cardiac ablation, hypertension, and robotics. He highlighted the PFA franchise’s 71% growth and the successful launch of Altaviva for incontinence. Martha expressed optimism about scaling manufacturing and pursuing tuck-in M&A to drive future revenue growth.

Guidance

CFO Thierry Pieton raised full-year revenue guidance to 5.5% growth, with Q3 expected at ~5.5% and Q4 stronger. EPS guidance was updated to $5.62–$5.66. The company projects 5% adjusted operating profit growth and 8% EPS growth in FY27. Q3 EPS is forecasted at $1.32–$1.34, with margin pressures from tariffs and business mix.

Additional News

Recent developments include the spinoff of the Diabetes business into a standalone entity, expected to boost adjusted gross margins by 50 basis points. Medtronic also announced the appointment of two new independent directors to its board, enhancing governance and operational focus. Additionally, the FDA approved the Altaviva™ device for urge urinary incontinence, expanding its neuromodulation portfolio.