Earnings call transcript: Boston Scientific Q3 2025 beats forecasts, stock climbs

Boston Scientific Corp (BSX) reported its Q3 2025 earnings, surpassing expectations with an EPS of $0.75 against a forecast of $0.71, marking a 5.63% surprise. The company’s revenue reached $5.07 billion, exceeding forecasts by 2.01%. Following the announcement, the stock price rose 2.43% in premarket trading, reflecting investor optimism. With revenue growth of 21.44% over the last twelve months and a market capitalization of $148 billion, the company’s strong performance was driven by significant growth in operational sales and strategic product launches. According to InvestingPro analysis, Boston Scientific is currently trading above its Fair Value, with 14 additional key insights available to subscribers.

Key Takeaways

• Boston Scientific’s Q3 EPS of $0.75 exceeded expectations by 5.63%.
• Revenue reached $5.07 billion, surpassing forecasts by 2.01%.
• Stock price increased by 2.43% in premarket trading.
• Operational sales grew by 19%, with organic sales up by 15%.
• Full-year 2025 adjusted EPS guidance raised to $3.02-$3.04.

Company Performance

Boston Scientific reported robust growth in Q3 2025, with operational sales increasing by 19% and organic sales surpassing guidance with a 15% rise. The company attributed its performance to strong demand for its Watchman and Therapulse technologies, as well as strategic expansions in the Asia-Pacific region. With an impressive InvestingPro Financial Health Score of 3.16 (rated as "GREAT") and a strong gross profit margin of 68%, this growth positions Boston Scientific favorably against competitors in the medical devices sector.

Financial Highlights

• Revenue: $5.07 billion, up from the previous quarter.
• Earnings per share: $0.75, a 19% increase year-over-year.
• Adjusted operating margin: 28%, reflecting efficient cost management.
• Organic revenue growth guidance for 2025 raised to approximately 15.5%.

Earnings vs. Forecast

Boston Scientific’s Q3 EPS of $0.75 exceeded the forecast of $0.71, resulting in a 5.63% earnings surprise. Revenue also outpaced expectations, reaching $5.07 billion compared to the $4.97 billion forecast. This marks a significant achievement for the company, continuing its trend of outperforming market expectations.

Market Reaction

Following the earnings announcement, Boston Scientific’s stock rose 2.43% in premarket trading, reaching $102.33. This positive movement reflects investor confidence in the company’s growth trajectory and strategic initiatives. With a beta of 0.61 and analyst consensus showing a strong buy rating of 1.32, the stock demonstrates relatively low volatility. The stock remains within its 52-week range, with a high of $109.5 and a low of $80.64, indicating room for further growth. Discover more detailed valuation metrics and comprehensive analysis with a InvestingPro subscription, including access to the full Pro Research Report.

Outlook & Guidance

Boston Scientific raised its full-year 2025 adjusted EPS guidance to $3.02-$3.04, reflecting a growth rate of 20-21%. The company anticipates Q4 2025 organic revenue growth of 11-13% and adjusted EPS between $0.77 and $0.79. With analyst targets ranging from $99 to $140 and a five-year revenue CAGR of 9%, strategic initiatives including the launch of Seismic IVL and the acquisition of Nalu Medical are expected to drive future growth.

Executive Commentary

CEO Mike Mahoney highlighted the company’s strategic investments and market leadership, stating, "We’re comfortable with a 20% market CAGR over the long-range plan." He also emphasized the importance of expanding market share in key regions, particularly in Asia-Pacific.

Risks and Challenges

• Supply chain disruptions could impact product availability and sales.
• Market saturation in key segments may limit growth potential.
• Macroeconomic pressures, such as currency fluctuations, could affect international sales.
• Regulatory changes in major markets could pose compliance challenges.

Q&A

During the earnings call, analysts inquired about the potential for further market expansion in China and the impact of the Nalu Medical acquisition. Executives addressed concerns about procedure pull-forwards and emphasized the company’s commitment to innovation and strategic growth.

Full transcript - Boston Scientific Corp (BSX) Q3 2025:

Drew, Conference Operator: Good morning and welcome to the Boston Scientific Third Quarter 2025 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Lauren Tengler, Vice President, Investor Relations. Please go ahead.

Lauren Tengler, Vice President, Investor Relations, Boston Scientific: Thank you, Drew, and thanks to everyone for joining us. With me today are Mike Mahoney, Chairman and Chief Executive Officer, and Jon Monson, Executive Vice President and Chief Financial Officer. During the Q&A session, Mike and Jon will be joined by our Chief Medical Officer, Dr. Ken Stein. We issued a press release earlier this morning announcing our Q3 results, which included reconciliations of the non-GAAP measures. The release, as well as reconciliations of the non-GAAP measures used in today’s call, can be found on the Investor Relations section of our website. Please note that on the call, operational revenue excludes the impact of foreign currency fluctuations, and organic revenue further excludes certain acquisitions and divestitures for which there are less than a full period of comparable net sales.

Guidance excludes the previously announced agreement to acquire Nalu Medical, which is expected to close in the first half of 2026, subject to customary closing conditions. For more information, please refer to the Q3 Financial and Operating Highlights deck, which may be found on the Investor Relations section of our website. On this call, all references to sales and revenue are organic, and relative growth is compared to the same quarter of the prior year unless otherwise specified. This call contains forward-looking statements regarding, among other things, our financial performance, business plans, and product performance and development. These statements are based on our current beliefs using information available to us as of today’s date and are not intended to be guarantees of future events or performance.

If our underlying assumptions turn out to be incorrect or certain risks or uncertainties materialize, actual results could vary materially from those projected by the forward-looking statements. Factors that may cause such differences are discussed in our periodic reports and other filings with the SEC, including the Risk Factors section of our most recent annual report on Form 10-K. Boston Scientific disclaims any intention or obligation to update these forward-looking statements except as required by law. At this point, I’ll turn it over to Mike.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Thanks, Lauren. Thank you, everyone, for joining us today. Our quarterly results again exceed our expectations, led by our innovative portfolio, strong execution, and a winning spirit of our global team. In third quarter 2025, total company operational sales grew 19%, and organic sales grew 15%, exceeding the high end of our guidance range of 12% to 14% with sustained high performance in both our cardiovascular and MedSurg segments. Q3 adjusted EPS of $0.75 grew 19%, exceeding the high end of guidance range of $0.70 to $0.72. Q3 adjusted operating margin was 28%. Turning to our fourth quarter and full year 2025 outlook, we are guiding to organic growth of 11% to 13% for fourth quarter 2025, which implies an increase to our full year 2025 guidance to approximately 15.5%, reflecting our confidence to sustain above market growth.

Our fourth quarter adjusted EPS guidance is now $0.77 to $0.79, and we are thus raising our full year adjusted EPS guidance to $3.02 to $3.04, representing growth of 20% to 21%. Jon will provide more details in the financial section. I’ll now provide some additional highlights on our third quarter results and outlook. Regionally, on an operational basis, the U.S. grew 27% with impressive growth. The excellent growth is broad-based across our cardiovascular businesses, endoscopy, and neuromodulation. Europe, Middle East, and Africa did decline 2% on an operational basis as a result of two impactful yet transient headwinds in the quarter. First, a discontinuation of our Accurate valve on May 2025, which had prior year third quarter sales of approximately $50 million. Secondly, we implemented our upgraded ERP system mid-quarter at our Kerkrade distribution center.

This did result in a backorder of approximately $30 million, impacting a number of our businesses in Europe. We do anticipate this backorder will improve throughout the fourth quarter. Excluding these two headwinds, the EMEA growth would have been high single digits, driven by strong double-digit growth in electrophysiology and continued high utilization of Therapulse and double-digit growth in complex PCI. Asia-Pacific grew 17% operationally, led by strong double-digit growth across Japan and China. Japan growth was driven by Watchman and electrophysiology, which saw excellent performance in the quarter, led by Therapulse, which recently received expanded labeling for persistent indication and was supported by our Opal HDX mapping system. China grew an impressive mid-teens despite the substantial VBP in our peripheral business. China growth was broad-based and driven again by growth in ICTX and EP.

Within the quarter, we received NMPA approval for the Watchman Flex Pro device and recently began commercial launch, which, coupled with Therapulse and investment in clinical evidence, such as Option A, drives our confidence and sustained mid-teens growth over the LRP in China. I’ll now provide some additional commentary on our business units, starting with Urology. Urology sales grew 27% operationally and 5% organically. Growth in the quarter is driven by our international business and the Global Stone Management franchise. Exonics performance continues to be below expectations as we are focused on improving our commercial execution post the unplanned commercial disruption. However, we remain enthusiastic about the S&M market opportunity and our future as we focus on strengthening the commercial team, patient activation, and globalization opportunities. We’re pleased to have recently received approval for Exonics F15 in Europe.

Our outlook for the Exonics business, coupled with our broad innovation cadence across the business, drives confidence in our expectation that Urology growth will improve throughout 2026. Endoscopy delivered an excellent quarter, growing 9%, driven by double-digit growth in key products, including Axios, Mantis, and Overstitch, combined with our differentiated broad portfolio. Notably, the U.S. grew 11%, led by the recent launch of Wall Flex Plus and above-market growth across the pancreaticobiliary franchise. Neuromodulation had a strong quarter. Sales grew 9%. Our brain franchise grew low double digits, supported by the five-year results from the Intrepid study, which demonstrated sustainable benefits of DBS in patients with moderate to advanced Parkinson’s disease. The pain franchise continues to strengthen and grew high single digits, led by strong double-digit growth in the U.S. with Intracept. The team is in the early stages of launching Intracept in Europe.

We also just announced our agreement to acquire Nalu Medical, which we anticipate will expand our portfolio into a new pain adjacency in peripheral nerve pain. This is an excellent new growth opportunity and complements our commercial strength with the interventional pain physician. We expect this transaction to close in the first half of 2026. Peripheral interventions sales grew 16% operationally and 6% organically, with excellent low double-digit growth in the U.S. that was offset by the China VBP. Within our peripheral vascular business, we saw a low single-digit decline in arterial, again driven by the China VBP. During September, Silk Road turned organic and delivered improved high single-digit performer growth within the quarter, supported by the recent launch of Enroute in China.

Looking forward, we continue to expect a very limited launch of Seismic IVL for peripheral above-the-knee procedures by year-end 2025 and an increase in launch cadence in 2026, and an increase in launch cadence in 2027. In venous, we saw excellent double-digit growth led by continued strength in Varithena and ECOSS. Within the quarter, Hypethro, our clinical study with ECOSS versus standard-of-care anticoagulants, completed enrollment, and we expect data to be presented in 2026. Our interventional oncology and embolization business grew double digits, driven by our category-leading embolization and cancer therapies portfolio, with notable strength in cryoablation, which treats a broad number of cancer types. Clinical evidence remains a key enabler for future growth, and within the quarter, we completed enrollment in two important trials: ROEN, which studies Therasphere in combination with AstraZeneca’s STRIDE regimen for patients with HCC, and OCLUDE, a large real-world registry for Obsidio conformable embolic.

Cardiology delivered another outstanding quarter with sales growing 23%. Within cardiology, interventional cardiology therapy sales grew 3%, which does include the impact of the Accurate withdrawal, with double-digit growth in coronary therapies, driven by Agent drug-coated balloon in the U.S. and our imaging catheters globally. The U.S. grew 21%, led by Agent DCB, where we continue to expect strong growth, supported by the new technology add-on payment that was recently approved and went into effect October 1. In the long term, we’re investing to expand the indicated patient population with evidence from our STANCE trial, evaluating Agent versus standard of care in de novo lesions, which began enrollment in August. We continue to be excited about the addition of Seismic IVL to our leading coronary therapies portfolio and expect completion of the FRACTURE trial in first quarter 2026. We expect to launch this differentiated technology in the U.S.

in early 2027, further expanding our C-Prep treat approach across our portfolio. Cardiac rhythm management sales grew 2%. Our diagnostic franchise grew low double digits, led by continued above-market performance with our Lux ICM device. In core CRM, our low voltage business grew low single digits with the momentum from the launch of our conduction system pacing tools in the U.S. and Europe, and our high voltage business declined low single digits. We recently closed the acquisition of the Alucia Bioenvelope assets, which are designed to prevent postoperative complications for devices such as pacemakers and defibrillators. We look forward to expanding the reach of this technology to more global markets as a complement to our core CRM portfolio. Watchman grew an outstanding 35% this quarter and surpassed 600,000 patients targeted to date. The excellent growth in the quarter reflects accelerated concomitant uptake in the U.S.

and continued penetration into the 5 million patients indicated today through excellent clinical results and strong patient and physician awareness. We continue to expect approximately 25% of the U.S. Watchman procedures to be done concomitantly, exiting 2025, with the potential for that to double by 2028, enabled by the trusted Therawatch approach. We are confident that we can continue to grow the Watchman market by approximately 20% for the years to come, driven by continued concomitant uptake, the upcoming data presentation of Champion in the first half of 2026, and the launch of our next generation device, Watchman Elite, expected in late 2027 or early 2028. Turning to EP, we’re incredibly proud of our EP performance, with third quarter sales growing 63% as we drive continued share gains in the overall EP market.

Therapulse remains the leading PFA technology, having treated over 500,000 patients to date with consistent and reproducible real-world results, further demonstrated in the recently published one-year results from the Theradys trial, which showed favorable procedural and safety outcomes and clinical effectiveness across ablation strategies and AF types. In the U.S., we saw continued strong double-digit growth in Therapulse, supported by ramping adoption of our Opal HDX mapping system, with one in three Therapulse accounts now utilizing our integrated Therawave NAV and Opal device. The team is executing our pipeline strategy, and we recently launched our contact sensing feature and are moving to full release this month. Looking forward, our aim is to continue to grow our share in the overall EP market, and we expect to retain a strong leadership position in PFA, enabled by our innovative portfolio, expanding mapping and commercial resources, and consistent data publications.

We expect global PFA penetration to continue to expand and to exit 2025 at 50% penetration and grow to approximately 80% by 2028. At our recent investor day, we shared that we aim to be the market share leaders, not just in PFA, but the overall EP market over time. We are investing today to outpace the approximately 15% market growth expected through 2028 by advancing our ecosystem of innovative solutions across both the AF and non-AF segments of the market. We are simplifying ablations and the workflows associated with them and expanding patient access through clinical evidence generation across the globe.

By year-end 2025, we expect to make meaningful progress towards expanding access to new technologies and more complex and redo patients with the launch of our Therapulse PFA catheter, as well as initiating enrollment in the Optimize trial, which will study the integration of Opal and the Cortex AI algorithm. Cortex is a differentiated mapping software designed to precisely visualize and target sources of arrhythmias, addressing an unmet need in the treatment of persistent AF patients with unexplained reoccurrence. In closing, I look forward to finishing out an outstanding 2025 and delivering under guidance, which will result in another year of delivering highly differentiated financial results for our peer group. As we highlighted at our recent investor day, we have an incredibly strong global team that is relentlessly pursuing and investing in meaningful innovation to deliver differentiated growth and leverage EPS growth this year and for years to come.

With that, I’ll hand over to Jon to provide more details on the financials.

Jon Monson, Executive Vice President and Chief Financial Officer, Boston Scientific: All right. Thanks, Mike. Third quarter consolidated revenue of $5.065 billion represents 20.3% reported growth versus the third quarter of 2024 and includes a 90 basis point tailwind from foreign exchange, which was favorable versus our expectations. Excluding this $38 million foreign exchange benefit, operational revenue growth was 19.4% in the quarter. Closed acquisitions contributed 420 basis points to sales, resulting in 15.3% organic revenue growth, which was above our third quarter guidance range of 12% to 14%. Q3 2025 adjusted earnings per share of $0.75 grew 19% versus 2024, exceeding the high end of our guidance range of $0.70 to $0.72, primarily driven by strong drop through on above-expectation revenue and margin performance in the quarter.

Adjusted gross margin was 71% for the third quarter, representing a 60 basis point improvement versus the third quarter of 2024, primarily due to favorable product mix driven by strong growth in electrophysiology and Watchman and partially offset by tariffs. As a result of our Q3 performance, we now anticipate full-year adjusted gross margin to slightly improve versus 2024, inclusive of an approximate $100 million tariff headwind for the full year, unchanged versus previous expectations. Third quarter adjusted operating margin was 28%, expanding 80 basis points versus the prior year period, driven by strong drop through on our top-line performance. On a GAAP basis, third quarter operating margin was 28.7%. Moving to below the line, third quarter adjusted interest and other expenses totaled $116 million, which was in line with our expectations.

On an adjusted basis, our tax rate for the third quarter was 13.6%, and our operational tax rate was 13.9%. Fully diluted, weighted average shares outstanding ended at 1.495 billion shares in the third quarter, and free cash flow for the third quarter was $1.163 billion, with $1.343 billion from operating activities, less $181 million in net capital expenditures. We continue to expect full-year 2025 free cash flow to be approximately $3.5 billion, reflecting strong cash conversion driven by earnings growth and disciplined working capital management. As of September 30, 2025, we had cash on hand of $1.275 billion, and our gross debt leverage ratio was 2.0 times. Our top capital allocation priority remains strategic tuck-in M&A in high growth adjacencies, followed by share repurchase. In alignment with this strategy, we recently closed our acquisition of the Alucia Bioenvelope assets and announced our agreement to acquire Nalu Medical.

Our legal reserve was $306 million as of September 30, with $46 million already funded through our qualified settlement funds. I’ll now walk through guidance for Q4 and full-year 2025. We expect full-year 2025 reported revenue growth of approximately 20%, excluding an approximate 100 basis point tailwind from foreign exchange. We expect full-year 2025 operational revenue growth of approximately 19%, excluding an approximate 350 basis point contribution from closed acquisitions. We expect full-year 2025 organic revenue growth of approximately 15.5% versus 2024. We expect fourth quarter 2025 reported revenue growth to be in a range of 14.5% to 16.5%, excluding an approximate 200 basis point tailwind from foreign exchange. We expect operational growth to be in a range of 12.5% to 14.5%, and excluding an approximate 150 basis point contribution from closed acquisitions.

We expect fourth quarter 2025 organic revenue growth to be in a range of 11% to 13% versus 2024. As a result of our year-to-date margin performance, we now expect to expand full-year adjusted operating margin by approximately 100 basis points at the high end of our prior range of 75 to 100 basis points. We continue to expect full-year 2025 adjusted below the line expense to be approximately $440,000. We also maintain our forecast for a full-year adjusted tax rate of approximately 12.5% and an operational tax rate of approximately 14%. We expect full-year adjusted earnings per share to be in a range of $3.02 to $3.04, representing growth of 20% to 21% versus 2024. We continue to expect an approximate $0.04 foreign exchange headwind on full-year adjusted earnings per share. For Q4, we expect adjusted earnings per share to be in a range of $0.77 to $0.79.

In closing, I’m pleased with our strong third quarter financial performance and look forward to executing on our full-year 2025 guidance and our long-range financial goals, which we shared at our recent investor day. From 2026 to 2028, we’re targeting 10% plus average organic revenue growth, approximately 50 basis points of annual adjusted operating margin expansion, leveraged double-digit adjusted earnings per share growth, and 70% to 80% annual free cash flow conversion. We feel that these goals represent differentiated performance in medtech, and we look forward to executing on them. Thank you all for joining us today. For more information, please check our Investor Relations website for the third quarter 2025 financial and operational highlights, which provides more details on our results and updated guidance. I’ll turn it back over to Lauren, who will moderate the Q&A.

Lauren Tengler, Vice President, Investor Relations, Boston Scientific: Thanks, Jon. Drew, let’s open it up for questions for the next 35 minutes or so. In order for us to take as many questions as possible, please limit yourself to one question. Drew, please go ahead.

Drew, Conference Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. Again, please limit yourself to one question. At this time, we will pause momentarily to assemble our roster. The first question comes from Robbie Marcus with JPMorgan. Please go ahead.

Oh, great. Good morning and congrats on a really good quarter here. One for me. Mike, this comes on the tail of what was a really bullish analyst day. I think what’s really coming through in the discussion this morning with investors is EP has been a phenomenal growth driver, but Watchman is really what’s the most exciting, at least from the print today and the incremental upside that you’re continuing to see an acceleration here off the back of Concomitant and the option data in the fall of last year. The question is really, do you think of Watchman as a key growth driver? How do you think people should really expect growth and dollar contribution to progress, assuming the Champion data is positive, just given how much this market has exploded and still how low penetration is potentially versus the addressable population? Thanks a lot.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Thank you very much, Robbie. We’re super pleased with the overall performance for the global company. You pointed out two excellent performers in electrophysiology and Watchman. Watchman clearly is a gem for Boston Scientific. We essentially created the market through great clinical evidence. You saw at investor day a really strong portfolio going forward for the future, along with expanded evidence and the big Champion trial to be read out first half 2026. Concomitant really continues to exceed expectations. It’s been adopted very quickly. We expect 25% of the Watchman procedures to be done at Concomitant. That’s certainly a tailwind for us. The whole combination of Therapulse and Watchman together in that procedure is really becoming standard of care for hospitals and physicians, given the safety profile and trust they have in that solution, along with our excellent commercial teams.

In framing the market, kind of similar to what we said in investor day, we’re comfortable with a 20% market CAGR over the LRP, given the strong momentum of Watchman, the underserved patient population that we continue to focus on. Also, the globalization of Watchman, we saw some good news in China in the quarter with the approval of Flex Pro, which will help China really strengthen their performance in 2026. There’s just a lot of great things going on with Watchman in terms of the Concomitant procedure itself, the trust that the community and referrers have in the Concomitant procedure, the tremendous pipeline of patients that are still very underserved, and the resources and investment that we’re placing in additional portfolio enhancements and clinical to broaden it out.

We have a very unique strong market share in Watchman, and we plan to continue that market share strength that we have while this market continues to grow very quickly.

Appreciate the thoughts. Thanks a lot.

Drew, Conference Operator: The next question comes from Joanne Winch at Citibank. Please go ahead.

Good morning, and thank you for taking the question. May I also say, very nice quarter. I’d like to step back just for a second and get your impression on two sort of bigger items that are impacting medtech. One is China. It sounds to me like your China business is doing just fine. Obviously, I would love your view. Second of all, we sort of picked up that there may be some procedures that are being pulled forward as people think about Affordable Care Act cuts and Medicare cuts as we look forward. I’d love to see or hear what you’re seeing in those things. Thank you.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Sure. The first one, procedure pull forward, we don’t have any signals that would indicate we’re seeing procedural pull forward across our businesses. That’s something we’ll watch out for. I would say we did not see that in the third quarter, more of a consistent procedural demand that we expected and continue to expect going forward. I think China shows really the winning spirit of our global team and the strength of our team in China. Really just the innovation focus that we have across Boston Scientific is represented well in China as we continue to differentiate ourselves versus our peer group there. In the quarter, we again grew mid-teens. We indicated at the investor day we are comfortable with double-digit growth across the LRP, even though that business is getting much larger for us.

As we’ve mentioned before, we are able to continue to offset VBP price pressures with new innovation and new launches in our combined portfolio, combined with expanding our reach of our customer coverage across the China opportunity. We have a broad base of business there. Years ago, it was solely ICTX, but the ICTX business is our largest business there. They do extremely well. The imaging business with ICTX has done remarkably well and growing quite well. The EP business had a nice quarter, and we expect bigger things out of the China EP business in the fourth quarter and as we go into 2026. That’ll provide some additional tailwind. Watchman Flex Pro is also a big launch for us as our Watchman business has been slower in 2025 without that product. We do see EP, Watchman, and ICTX continue to carry and offset the VBP headwinds that we face.

That’s why we’re comfortable with the double-digit growth going forward.

Thank you so much.

Drew, Conference Operator: The next question comes from Larry Biegelsen with Wells Fargo. Please go ahead.

Good morning. I’ll echo my congratulations on another really nice quarter here. I wanted to follow up on Robbie’s question on Watchman and the LAA market. I think some investors were surprised by the 20% market outlook you provided at investor day, given the growth we’re seeing today, which is much higher, and we have Champion coming in the first half of next year. My question is, is there anything you’re seeing in studies like Alone AF and Ocean that’s coming at American Heart that concerns you? Maybe just lastly, Dr. Stein, how much of a read-through will closure AF at American Heart be to Champion? Thanks for taking the question.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: I would say at a high level, hopefully you appreciate that we do like to provide as accurate forecasts as we can on market growth, but we also like to deliver and exceed our commitments. I think that’s really important for our team and our investors. I think, Ken, you can speak to the more substantial part of the question.

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Yeah, no, thanks, Mike. Thanks, Larry. I got to thinking about 20% growth over a sustained number of years of the LRP as conservative, it just says something about just how impactful Watchman has been as a therapy. I think will continue to be. As we mentioned earlier with Robbie’s question, even the currently indicated population is way underpenetrated. That’s why we are very comfortable in that 20% growth over the long-range plan. I think I’ll answer your questions about some of the studies that are coming up. Let me talk about them. First, closure. That’s a trial that is going to be reported on AHA. I don’t think it’s a particularly good read-through for Champion. It’s a very different European population, a very different primary endpoint, a shorter follow-up.

We continue to think that other trials like PROG-17 and OPTION honestly give us real confidence in what we hope that Champion will show. I think in terms of Alone AF and a trial called OCEAN that will be reported out at AHA, both of those, first off, if OCEAN is confirmatory of Alone AF, that’s great news, right? Saying that low-risk patients undergoing AF ablation may no longer need stroke prevention. I want to remind you all that up until now, except for very select populations, AF ablation was only really indicated as a way of managing patients with significant symptoms from their AF. This supports the continued growth of Therapulse as patients seek AF ablation in order to come off their blood thinners. This is important, the patients who are currently getting concomitant Therawatch procedures are not the low-risk patients who were studied in Alone AF.

We have not seen any material impact to concomitant following the publication of Alone. Again, sort of taking all of this together, the significantly underpenetrated currently indicated population, the prospect of indication expansion with trial like Champion, the continued growth in ablation for AF, we remain really comfortable with the projection of 20% annualized growth over our LRP.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: All right, thank you so much.

Drew, Conference Operator: The next question comes from Rick Wise with Stifel. Please go ahead.

Good morning, Mike. Hi, Jon. I’d like to focus on the very impressive margin performance. Jon, you kept saying strong drop through to margins from the revenue app performance. Got it. I was hoping you would sort of give us a little more color. I mean, your gross margins, which I know you don’t go to specifically, almost back now to pre-COVID levels. Help us think through as we try to model, looking ahead, where do we go from here on the margin front? How big a driver of your operating margin goals is gross margin? Just help us understand maybe with a little more color the drivers from here. It just feels like given the revenue strength and what we saw this quarter that your 50 basis point annual improvement could prove conservative, he said optimistically.

Thanks so much, Rick. Appreciate the question. Yeah, pleased with the performance in the quarter and our expectation to expand operating margins 100 basis points on the year, overcoming the tariff impact of approximately $100 million that we’ve sized for the year. In the quarter, as I mentioned, saw a very strong gross margin tailwind from Nix. We spent some time talking in Q&A about Watchman, the 35% growth there. EP continued to perform very well for us. Nice mixed benefit there. You heard Mike mention in his remarks how well our agent drug-coated coronary balloon is performing. Nix really driving the gross margin performance that we saw in the quarter. We’re now expecting the gross margin to slightly improve year over year despite that $100 million tariff headwind.

As we head into next year, we’re rolling up our annual operating plan process now and will provide more detail as we typically do when we have our Q4 call at the start of next year. Broadly, as we mentioned at our investor day, do expect to expand operating margin each year, every year, targeted roughly 50 basis points a year. Within the pieces there, would expect to, with gross margin, would expect that Nix will continue to be a tailwind for us. We will see annualization of tariffs in 2026. That will be a further headwind based off of our expectations today. Expect us to continue to drive leverage through SG&A. R&D, we’ve got that roughly between 9% and 10%. I think that’s a nice level of investment at the high end of our peer set. I think that’s a good place for us to live moving forward.

Again, appreciate the question, Rick. Love the momentum of the business and the financial performance while reinvesting back into the business for growth. As always, we’ll provide much more detail when we get to our Q4 call at the start of next year.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Thanks, Jon.

Drew, Conference Operator: The next question comes from David Roman with Goldman Sachs. Please go ahead.

Thank you. Good morning, everybody. Mike, you referenced this in response to one of the earlier questions, but was hoping you could expand on the dynamics in the business kind of outside EP and Watchman. There’s obviously a disproportionate focus on those businesses given how strong a growth contribution they’ve been. As we look forward, I think everyone understands that the EP business is going to decelerate given just the size and the competitive landscape there, even with strong market growth. I took it across the rest of the portfolio, you’re seeing good momentum in businesses like neuromodulation and endoscopy. You talked about some of the improvements you’re seeing in Silk Road. Maybe help frame for us what are kind of the drivers that support the growth outlook in the rest of the business and where you think from a product perspective we should be focused.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: David, I really appreciate that question. Much of the attention goes to our electrophysiology (EP) business, and it should, given that we were at distant number four and now we’re a clear number two and have a higher aim over the future. As you said, it’s not going to grow as fast as it has, given that we’re anniversary in comps and the size of the business. We expect it to be an outstanding performer in 2026 and beyond in our EP business. I’m really proud of the rest of the divisions. Not every one of our businesses grows faster than the market every quarter, but as a composite, we clearly do. That’s what we indicated at our investor day, to grow faster than our 9% WAMGR. MedSurg in the quarter had a healthy 8% growth, very strong growth with our endoscopy business.

We’ve got a few different alliances and product launches that we’re launching in 2026. We expect strong endoscopy performance. Urology has had a tougher year. We have high expectations. We talked about Exonics in the script. We expect Exonics to get stronger in the fourth quarter and in 2026. Urology will actually have some easier comps in 2026. We expect some acceleration there. I’m really proud of our Neuromod team. They’ve really clawed back over the years, and now they drove 9%. I think it was 9% growth in the quarter. We just closed the, or we haven’t closed. We signed the Nalu acquisition, another great adjacency for us. We will be, with Nalu, the clear category leader from a portfolio perspective in pain business, with an improved and strengthened SCS business, a solid RF business. Relievant has done better than we had planned with that acquisition, and now Nalu.

Similar to endoscopy and other businesses, we have the widest portfolio in neuromodulation and some unique abilities to work with our customers in that regard. Our ICTX business has transformed itself from a reliance on DES to a high-growth business led by our imaging business, our agents, and complemented with the rest of our portfolio. As we said in investor day, we have our largest investments in the company within ICTX. The most near-term one is our IVL product for peripheral interventions (PI), which will launch in a limited way at the end of this year. We’ll get a full benefit of that in 2026. The trial for IVL in cardiology is going extremely well. We look to wrap that up hopefully early in first quarter 2026 and launch that in early 2027. We have a number of other large investments, some that we talked about in Investor Day.

IO continues to do well, growing double digits. Our Venus portfolio grew double digits, and they absorbed some of the pricing challenges in China. EP gets the airtime, but the rest of the business continues to do very well. What’s most important is we spend a lot of time on those businesses, constantly feeding them with organic R&D, tuck-in M&A, expanding clinical work so we continue to grow above market as our WAMGR continues to grow.

Excellent. I appreciate all the perspective. Thank you.

Drew, Conference Operator: The next question comes from Travis Steed with Bank of America. Please go ahead. Excuse me, Mr. Steed, is your phone muted accidentally?

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Working on the strategy draft.

Drew, Conference Operator: Yeah, please go ahead with your question, sir.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Favorite wire. Not much on that.

Drew, Conference Operator: We’ll go to the next question. It comes from Michael Pollard with Wolfe Research. Please go ahead.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Hey, Jon Monson.

Hey, good morning. Thank you. I have a question on PFA and persistent. Therapulse PFA technology got the FDA label for persistent in July. I’m hoping you can confirm Therapulse is on track for year-end 2025. If both of those things are true, are Therapulse still on track? Is this the cocktail to get the penetration of PFA into persistent kicked into a higher gear? I hear about 50% PFA penetration at a high level, but I think that’s a much higher rate of penetration into paroxysmal or de novo cases and lower into more complex cases, including these persistent patients. I’m just kind of interested, is 2026 the year where persistent really kicks into a higher gear? If not, what is the cocktail to enable that? Thank you.

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Yeah, Mike, I’ll take that. I actually, particularly for de novo persistent, it’s already in high gear. You know, we got that approval on the back of the results of our Advantage trial, which frankly showed the best long-term outcomes anyone has ever seen in a de novo persistent ablation trial. You know, really remarkable long-term freedom from high-burden persistent atrial fibrillation or from symptomatic atrial fibrillation. One of the things that I don’t know that everyone has appreciated enough to this point is that, if you look at the results of trials like Advantage, as well as some of the real-world data now that we’ve presented at meetings, the redo rates after de novo persistent AF ablation with Therapulse are down into the single-digit levels. I think I would not agree with the characterization today of de novo persistent as a particularly complicated ablation.

The Therawave catheter is just exquisitely well suited for this ablation strategy of pulmonary vein isolation plus posterior wall ablation. I think I would agree with your premise when you get to the more complex things like redo procedures. That’s where things like having Therapoint as an adjunct, we get to things like our Theraflex catheter that’s in for human use clinical trials today, as well as things like the acquisition that we had of the Cortex technology, as Mike mentioned in the script, right, to enable really true precision mapping of AF sources so that you do have something that you can offer to those, again, single-digit number of patients who are going to have unexplained recurrences after their de novo ablation.

Just to come back to it, we really already do see a very high degree of uptake of Therawave in the de novo persistent population and expect to see that continue.

Thank you.

Drew, Conference Operator: The next question comes from Travis Steed with Bank of America. Please go ahead.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Hey, congrats on the good quarter, and I’m finished with the fantasy draft, so I’m back. I wanted to ask about the $30 million backorder you called out. I know a small amount, but it did add, like, it could add a point of growth to the total company. What businesses did that impact? Was there anywhere where it impacted the most in the quarter, and does that come back in Q4? Sure. Thanks for the question. This is a very comprehensive global ERP implementation that we embarked on a few years ago. This was our implementation at our Kokrod distribution facility, which didn’t quite go as planned. The team is doing a great job and recovering from that, and things certainly look better now than they did 60 days ago. I appreciate our team’s hard work in that area. The impact of the quarter was fairly broad-based.

I’d say it trended a bit more to the MedSurg and PI businesses. It was really kind of impacted across many businesses, less impact on EP and less impact on Watchman and a bit more impact on the other divisions. The team has made really good progress. We’re still not 100% out of the woods on the backorder, but we expect that backorder to bleed down to acceptable levels by the end of the year. Great. Thanks a lot.

Drew, Conference Operator: The next question comes from Patrick Wood with Morgan Stanley. Please go ahead.

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Awesome. Thanks for taking the question. I’d love to just dig into Nalu, given you guys, it’s very recent and you’re in that situation. You know, PNS, obviously super interesting market, like there’s kind of nobody really else there. I know they’re very small, the other players. What was it that kind of made you feel like, you know, now is the time? I know you guys have been following them closely for a while, but I’d love any more details on how you guys are feeling expanding there and driving particularly commercial coverage over time. Thanks, guys.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Yeah, as I mentioned, we’re excited about the Nalu signing. In terms of timing, like many companies that we end up acquiring, we were a VC investor in Nalu when Keegan Harper and team started this many, many years ago. We always liked the space of peripheral nerve stim. The Nalu team did a really nice job over many years of building up the portfolio, driving the clinical evidence where now they have solid Medicare reimbursement and improving coverage from the commercial payers. A nice job in terms of clinical evidence, which is driving the reimbursements, and also solid clinical performance and solid sales track record. I think just as importantly, we always look at in our integrations, is it the right time for the business to integrate Nalu?

Our Neuromod team with Jim Cassidy has done an amazing job, Brian Betts and others, with Relievant that we acquired, I don’t know, 18 months ago or so, which also is a very unique asset in that pain space and what’s driving considerable growth for the company. The team proved they can drive the integration successfully, and they’re ready to take on more. We had a large VC investment in this business. It’s a perfect puzzle piece to add to our neuromodulation and pain business because it really does offer a highly differentiated portfolio versus our others who primarily compete in spinal cord stim. This is another new adjacency that will add to our WAMGR and accelerate the growth of Neuromod in 2026.

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Love the color. Thanks so much.

Drew, Conference Operator: The next question comes from Danielle Antalfi with UBS. Please go ahead.

Good morning, guys. Thanks so much for taking the question and congrats on a good quarter. Mike, I also have to admit to you that you were right about the Raiders. My question is on CRM, and that’s been a business where you guys have been growing below the market. You have a competitor that’s in a new product cycle, and they’re actually talking about sustainable double-digit growth going forward. You guys have a new product cycle coming. I’m just curious about how you think about the cadence of growth in that business as we start to get into the launch of some of those new products. Thanks so much.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Yeah. Overall, CRM, we’re pleased with our performance in our Lux, which is a smaller part of the market, but that continues to do quite well. We’ve been investing for a number of years on an entire new platform called Denali, which will really be, there’s different stages to that Denali launch that will happen through the tail end of the second half of 2026 and through the LRP period, which Ken can provide more detail, which really is a complete refresh, which we think will improve our core pacemaker defibrillator business. We’re also enthusiastic about Empower, our entry into the leadless pacemaker market, combined with SICD. We’ve been probably growing on a unit basis, kind of at market, but on a dollar basis below market because we’ve had some of the gaps in leadless, which drive a higher ASP.

On a unit basis, we’re kind of holding our own, we’re in that market, and we’re confident that over this LRP period that this CRM business will strengthen versus where it is today and be a larger contributor for us.

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Yeah, maybe I’ll just add to what Mike said. I mean, again, we certainly do have a gap in not being in the leadless market, excited about eventually being able to bring the Empower device to market. See that as important both as playing in leadless, but also as something that’s going to be an enabler for accelerated growth within our SICD franchise. I’d also point to the acquisition of Alucia. This is an important adjunctive technology that people are using to prevent complications, in particular things like postoperative infections or postoperative complications with the pockets for these devices. That’s another market that we have not played in previously, and it’s one where we have a technology that we really do see as having differentiated advantages over the incumbent. Mike mentioned our complete refresh of our entire implantable platforms, Brady, high-voltage CRT, and SICD.

That’s sort of a generational opportunity to really develop market-leading technology across all of those platforms. I think I’ll also highlight where we’ve gone with conduction system pacing, seeing fantastic growth in the use of our conduction system pacing technology for pacemaker for Brady indications, but also very excited to have a purpose-built ICD lead for doing conduction system pacing in the TACI market that we think would be quite disruptive.

Thank you.

Drew, Conference Operator: The next question comes from Vijay Kumar with Evercore. Please go ahead.

Hey, guys. Congratulations on the nice sprint, and thank you for taking my question. Jon, maybe one for you on the margins here. When I look at fiscal 2025, you had the TAVR recall charges in tariff. Despite that, we’re at 100 basis points of margin expansion, right? When you look at the cadence, I think Q4 is down sequentially, right? Is that the incremental tariff headwind from Q3 to Q4? How should we think of fiscal 2026, right? Is the analyst, they had 50 bps of annual OMX, is that still relevant for 2026?

Yeah, thanks, Vijay, for the question. Yeah, pleased with our expectation for improving margins 100 basis points on the year despite the tariff headwind of roughly $100 million. As you mentioned, we had the impact of the Accurate withdrawal in the second quarter. Despite that, I think we’ve done a nice job with finding appropriate offsets in the business, driving strong margin expansion predominantly with the top-line performance that we’ve seen for the year. Again, expecting 15.5% organic revenue growth and reinvesting back into targeted areas of the business to drive growth for the long term. We’ll see where we go for the fourth quarter. We manage margins really on an annual basis. We’re a little less focused quarter by quarter, more focused on how we’re driving margin performance for the year.

As far as 2026, we’re rolling up the plan process now, and we’ll provide much more detail there when we get to the Q4 call at the early part of next year. You should expect us to expand operating margins and drive meaningful expansion there and deliver leveraged double-digit EPS growth.

Thank you.

The next question comes from Chris Pascual with Nephron Research. Please go ahead.

Thanks. I wanted to ask about Agent. Our work suggests that launch is going really well. Product has a chance to be maybe a billion-dollar product for you as the indication expands, although it’s not getting a ton of attention yet. I’m curious how you’re thinking about growth in the interim period before stents read out. Is there enough room, just in ISR, to sustain the current momentum, especially with competition maybe coming into the U.S. next year? While I know you don’t promote off-label use, are you starting to see physicians already moving beyond in-stent restenosis and utilizing the product in de novo lesions?

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Yeah, Chris, maybe I’ll take that. The fast answer is, yeah, we do see plenty of room for continued growth even before Stance completes enrollment and reads out, right? Pleased now to have a TPT and better reimbursement in place. I think, you know, point out, you know, we also, with trials like Stance, see an opportunity to at least double the indicated population as you move beyond in-stent restenosis into small vessel bifurcation disease and some other de novo lesions. We will have some additional data on Agent coming out at TCT, data from our Agent post-approval study. I think that’ll be helpful as you all do kind of see the sorts of lesions that it is being used for in the real world and see the real-world outcomes.

In terms of competition, I think getting more data out about the use of drug-coated balloons is good for us and good for Agent. I think it’s important to point out that within the use for drug-coated balloons specifically, there are some real fundamental advantages to the use of paclitaxel as the drug compared to some of the other drugs. Very comfortable with the position that we have for Agent and excited about it as we laid out on Investor Day as a long-term growth driver for the company.

Thanks, Dr. Ken Stein.

Drew, Conference Operator: The last question today will come from Peter Chickering with Deutsche Bank. Please go ahead.

Hey, good morning, guys. Thanks for fitting me in here. A question about the proposed reimbursement for AF ablation and ASCs for next year. What proportion of AF ablations do you think could be moved into the ASCs? How could the increased capacity using ASCs help fuel additional market growth?

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Yeah, I may have to get a phone in a friend with our IR team here. Just more anecdotally, we’re certainly seeing some strong interest in the states that don’t have a certificate of need. You’re seeing some interest in Arizona and Florida, which we think is good, as we talked about before, given the oftentimes long backlog that hospitals have with Therapulse. We think this will help with the backlog over time in some of those states. Many states aren’t able to do it because of certificate of need and so forth. We certainly think it’s going to be an increasing trend in 2026, and it will grow more so over the LRP period.

As importantly, I think we’re uniquely positioned to win in that market, given the reliability and trust that physicians have in Therapulse, the COGS profile and gross margin profile that we have for that product, as well as the complementary products that Boston Scientific offers across our cardiovascular portfolio to assist those customers. I did get an answer from my phone and the friends that says what we estimate is 40% of the AF ablations in the U.S. will not need a certificate of need.

Yeah, or in states that don’t require a certificate of need.

Dr. Ken Stein, Chief Medical Officer, Boston Scientific: Maybe that’s the answer. Even in those states, it will take some time to build out the ASC capabilities. It’s capital deployment, and it’s not going to be a step change like the step change that we saw with the adoption of concomitant. This is going to be more of a slow ramp. I think it’s really important just to come back to what Mike said at the end, which is that Therapulse and our entire ecosystem really is very well suited to enable these procedures to move out into the ASC.

Mike Mahoney, Chairman and Chief Executive Officer, Boston Scientific: Yeah, we think there’ll be a minimal impact on ASC in 2026. I just think broadly on electrophysiology, you know, we’re still remarkably early in the PFA journey, given our launch, what, 18 months ago, Ken, or whatever, less than two years ago, I guess.

June 24, yeah.

Yeah. The key for us is we continue to drive new account openings around the globe. We still have a lot of work to do with new account openings in the U.S., particularly in Asia-Pacific. The new account openings help drive penetration. We also have the opportunity to continue to grow deeper with more physicians leveraging Therapulse. We also have the opportunity with our unique position with concomitant to train more electrophysiologists to do Watchman. We still have a number of EPs out there that are not doing LAA procedures. With the impact of concomitant, we are seeing an uptick in the number of physicians who want to be trained on LAA. That ecosystem is still early innings in PFA globally.

The momentum of concomitant and the demand from physicians to learn and train on Watchman now to serve that need will continue to help us, which is why the ASCs are important, because we do need the ASCs over time to help with the volume demands that we’re seeing across these markets.

Thank you, Mike. Thanks for joining us today. We appreciate your interest in Boston Scientific. If we were unable to get to your question or if you have any follow-ups, please don’t hesitate to reach out to the investor relations team. Before you disconnect, Drew will give you all of the pertinent details for replay. Thank you, everyone.

Drew, Conference Operator: Please note, a recording will be available in one hour by dialing either 1-877-344-7529 or 1-412-317-0088 using replay code 721-5110 until October 29, 2025, at 11:59 P.M. Eastern Time. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.

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