Boston Scientific Corporation (NYSE: BSX) Q3 2024 Financial Results

Boston Scientific Corporation discussed its third-quarter financial results on October 30, 2024, revealing a significant increase in operational and organic sales. The company’s adjusted earnings per share (EPS) outperformed expectations, and full-year guidance was raised in light of the strong performance.

The U.S. market saw impressive growth, notably in the electrophysiology sector, and the company is preparing for the acquisition of Axonics, along with several new product launches. Despite some concerns over trial pauses, Boston Scientific expressed confidence in the FARAPULSE system and its global adoption for atrial fibrillation procedures.

Key Takeaways

• Total operational sales grew by 19%, with organic sales up by 18%, surpassing the forecasted 13% to 15%.
• Adjusted EPS for Q3 reached $0.63, a 27% increase year-over-year, beating the expected range of $0.57 to $0.59.
• Full-year guidance was raised to approximately 15% growth, with adjusted EPS projected at $0.64 to $0.66.
• The U.S. market experienced a 24% growth, while Europe, the Middle East, and Africa saw a 14% increase.
• Upcoming acquisition of Axonics and product launches, including the ACURATE Prime Valve and the FARAPULSE PFA system in Japan, were announced.
• The company expects full-year free cash flow to exceed $2 billion and reported a gross debt leverage ratio of 2.4 times.

Company Outlook

• Boston Scientific anticipates a 14% to 16% organic growth in the fourth quarter.
• Full-year 2024 reported revenue growth is expected to be around 16.5%, with adjusted EPS between $2.45 and $2.47.
• The company is optimistic about growth in various medical segments and is focusing on expanding capacity and efficiency.

Bearish Highlights

• The adjusted gross margin for Q3 was slightly below expectations at 70.4%.
• The AVANT GUARD trial was paused due to unexpected observations, affecting the timeline for potential label expansion.

Bullish Highlights

• Boston Scientific is confident in the FARAPULSE system's global adoption and upcoming FDA submission.
• The company has successfully launched new products and is experiencing robust growth in Europe.
• Strategic investments are expected to lead to operating margin expansion.

Misses

• There was a slight slowdown in procedure volumes during the summer months, but recovery was seen in September.
• Adjusted gross margin for Q3 was slightly lower than anticipated due to foreign exchange impacts.

Q&A Highlights

• Executives reassured investors about FARAPULSE's safety and efficacy based on data from over 125,000 treated patients.
• The company discussed the potential impact of the OPTION trial and reimbursement changes on the AF market.
• There was optimism about the FARAWAVE NAV Catheter and FARAVIEW mapping system enhancing user experience.

Boston Scientific's third-quarter performance showcased strong financial growth and strategic initiatives aimed at maintaining this momentum. With new product launches and acquisitions on the horizon, the company is poised to continue its trajectory of expansion and innovation in the medical technology sector. Despite some clinical trial setbacks, investor confidence remains high due to the company's robust pipeline and strategic investments in key areas of medical technology.

InvestingPro Insights

Boston Scientific Corporation's (NYSE: BSX) strong third-quarter performance is reflected in its recent market valuation and financial metrics. According to InvestingPro data, the company's market capitalization stands at an impressive $126.98 billion, underscoring its significant presence in the Healthcare Equipment & Supplies industry.

The company's revenue growth of 13.65% over the last twelve months aligns with the reported operational sales growth of 19% in Q3. This robust top-line performance is complemented by a healthy gross profit margin of 68.69%, which supports the company's ability to invest in new product launches and strategic acquisitions like Axonics.

InvestingPro Tips highlight that Boston Scientific is trading near its 52-week high, with a substantial 75.56% price return over the past year. This market enthusiasm seems justified by the company's strong financial results and raised full-year guidance. The tip indicating that net income is expected to grow this year corroborates management's optimistic outlook for adjusted EPS growth.