Medtronic Profit Down 2% But Tops Estimates
Medtronic on Monday said quarterly profit fell 2 percent from a year ago, as the recall of a component used with its implantable devices to treat abnormal heart rhythms hurt revenue.
Fiscal second-quarter net income was $666 million, or 58 cents per share, compared with $681 million, or 59 cents per share, a year ago. That beat analysts' average forecast of net earnings of 55 cents a share, according to Reuters Estimates.
The medical-device maker's shares gained 1.66 percent in after-hours trade, having slipped 1.14 percent during regular market hours on the New York Stock Exchange.
Medtronic last month suspended sales of the Sprint Fidelis family of leads, or wires that link the heart to an implantable cardioverter defibrillator (ICD), saying the equipment may have contributed to five patient deaths.
Medtronic is the largest maker of ICDs -- life-saving devices that can shock a racing heartbeat back to normal rhythm -- with about 50 percent of the market.
Medtronic's overall second-quarter revenue rose 2 percent to $3.12 billion from a year ago, but sales of its ICDs declined 16 percent to $639 million.
Quarterly revenue from the company's overall cardiac rhythm disease management business, which also includes pacemakers, fell 8 percent to $1.15 billion.
Sales of ICDs have declined since 2005 following a series of defibrillator recalls, mostly by Guidant, later acquired by Boston Scientific, that slowed demand from cardiologists and their patients.