Release Date: April 23, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Boston Scientific Corp (BSX, Financial) reported a strong Q1 2025 with operational sales growth of 22% and organic sales growth of 18%, exceeding guidance.
- Adjusted EPS for Q1 2025 was $0.75, a 34% increase, surpassing the guidance range.
- The company raised its full-year 2025 organic growth guidance from 10%-12% to 12%-14%, reflecting strong performance in its cardiology portfolio.
- Electrophysiology sales grew 145%, making Boston Scientific the number two player globally in this segment.
- The company received credit rating upgrades to A- from both Standard & Poor's and Fitch Ratings, indicating strong financial health.
Negative Points
- Boston Scientific faces a $200 million tariff impact in 2025, primarily affecting the second half of the year.
- The Cardiac Rhythm Management segment showed only 1% growth, slightly below market expectations.
- The Urology segment experienced supply chain issues, leading to backorders and impacting growth.
- Foreign exchange headwinds negatively impacted Q1 2025 revenue by 130 basis points.
- The company anticipates a potential 200-300 basis point increase in its tax rate in 2026 due to the sunsetting of the TCJA.
Q & A Highlights
Q: How is Boston Scientific planning to offset the $200 million tariff headwind for 2025?
A: Daniel Brennan, Chief Financial Officer, Executive Vice President: The company plans to offset the tariff impact through increased revenue performance, targeted discretionary spend reductions, and a small benefit from foreign exchange. There are no current plans to move manufacturing infrastructure, as significant investments have been made in Minnesota and Georgia.
Q: Can Boston Scientific overtake J&J to become number one in Electrophysiology (EP)?
A: Michael Mahoney, Chairman of the Board, President, Chief Executive Officer: The aim is to become number one in EP, supported by clinical science, PFA leadership, and significant global investments. The US and Europe are performing well, and significant investments are being made in China and Japan to expand market share.
Q: What are the growth prospects for the WATCHMAN franchise?
A: Michael Mahoney, Chairman of the Board, President, Chief Executive Officer: WATCHMAN experienced 24% growth, driven by strong adoption of concomitant procedures. The company is investing in clinical trials and next-gen products, with a focus on increasing patient awareness and physician training.
Q: How is Boston Scientific managing the impact of trade wars and supply chain disruptions?
A: Michael Mahoney, Chairman of the Board, President, Chief Executive Officer: Despite the complexities of the Chinese market and VBP pressures, Boston Scientific expects double-digit growth in China. The company has a well-optimized global supply chain and continues to invest in manufacturing capabilities to support long-term growth.
Q: What is the outlook for the Cardiac Rhythm Management (CRM) division, particularly with the upcoming EMPOWER approval?
A: Michael Mahoney, Chairman of the Board, President, Chief Executive Officer: The CRM division is expected to see improved momentum with the anticipated approval of EMPOWER in the second half of 2025. The EMPOWER leadless pacemaker is expected to enhance the CRM portfolio, particularly in addressing unmet medical needs in high-voltage therapy.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
