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- **Revenue and Margin Strength**: Q3 revenue +8%, adjusted EPS +38% to $1.32, operating margin expands 450 bps to 27.1%.
- **Strategic Wins**: $124M incremental contracts (48% YoY), strongest Q3 contracting performance in company history.
- **Philips Expansion**: Targeting significant share gains in Philips' installed base, with potential for accelerated growth over next 5 years.
- **AI and Wearables**: Launching AI-enabled sensors for opioid monitoring and wearable pilots (e.g., Radius VSM) with 2026 launches.
- **Guidance Tightened**: 2025 revenue $1.510-$1.530B, EPS raised to $5.40-$5.55 (midpoint +$0.15), driven by margin expansion and buybacks.

**【CEO Summary Section】**
- **Revenue Growth**: Q3 revenue increased 8% year-over-year, driven by strong demand for innovative technologies. Adjusted EPS rose 38% to $1.32, with operating margin expanding 450 basis points to 27.1%.
- **Strategic Wins**: Secured $124 million in incremental contracts, a 48% year-over-year increase, marking the strongest Q3 contracting performance in company history.
- **Philips Partnership**: Expanded collaboration with Philips, targeting significant share gains in Philips' installed base, with potential for even greater growth over the next 5 years compared to the past 5 years.
- **AI and Monitoring Innovations**: Launched AI-enabled sensors for opioid-induced respiratory depression detection, aligning with CMS requirements for hospital reporting. Wearable technology pilots (e.g., Radius VSM) demonstrate cost savings and clinical benefits, with plans for broader launches in 2026.

**【CFO Financial Commentary】**
- **Financial Highlights**: GAAP revenue $371 million (+8% YoY), operating cash flow $57 million. Tightened 2025 revenue guidance to $1.510-$1.530 billion, raising EPS guidance to $5.40-$5.55 (midpoint +$0.15), driven by margin expansion, share buybacks, and reduced interest expense.
- **Margin Expansion**: Gross margin 62.2%, operating margin 27.1% (vs. 22.6% last year). Excluding tariffs, operating margin would be 28.5%, reflecting strong cost control.
- **Capital Allocation**: Returned $350 million to shareholders via $2.4 million share buybacks. Proceeds from Sound United sale used to repay debt and optimize capital structure.

**【Q&A Key Highlights】**
- **Philips Share Growth**: CEO emphasized Masimo's underpenetration in Philips' installed base, with potential for accelerated share gains in advanced monitoring categories (e.g., capnography, hemodynamics).
- **Wearable Technology**: Pilots for Radius VSM, W1, and Philips-integrated wrist sensors show promise for telehealth and continuous monitoring, with full launches expected in 2026.
- **2026 Outlook**: CFO noted normalization of fiscal year timing, with focus on consumable growth and margin expansion. Q4 shipments of large international contracts will drive accelerated consumable revenue growth.
- **Tariff Impact**: CFO highlighted $5 million tariff-related cost increase, but operational improvements offset部分 margin pressure, with plans to mitigate future impacts.


Masimo Corporation (MASI) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

MASI

MASI fundamentals

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