Medtronic plc.
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Item 1. Business
Medtronic plc, headquartered in Galway, Ireland, is the leading global healthcare technology company. Medtronic was founded in 1949 and today serves healthcare systems, physicians, clinicians, and patients in more than 150 countries worldwide. We remain committed to a mission written by our founder in 1960 that directs us “to contribute to human welfare by the application of biomedical engineering in the research, design, manufacture, and sale of products to alleviate pain, restore health, and extend life.”
Our Mission — to alleviate pain, restore health, and extend life — empowers us to engineer the extraordinary and deliver better outcomes for our world. We are a company of dedication, honesty, integrity, and service. Building on this strong foundation, we are embracing our role as a healthcare technology leader and evolving our business strategy in three key areas:
•Accelerate innovation-driven growth: The combination of our attractive end markets, recent product launches and robust pipeline is expected to enable continued strong revenue growth. We aim to bring inventive and disruptive technology to large healthcare opportunities which enables us to better meet patient needs. Patients around the world deserve access to our life-saving products, and we are driven to use our local presence and scale to increase the adoption of our products and services in markets around the globe.
•Deliver superior outcomes and better experiences for patients and providers: We listen to our patients and customers to better understand the challenges they face. From the patient journey, to creating agile partnerships that produce novel solutions, to making it easier for our customers to deploy our therapies — what we do is anchored in deep insight, and creates simpler, superior experiences.
•Turn data, AI, and automation into action: We are confident in our ability to maximize new technology, AI, and data and analytics to tailor therapies in real-time, facilitating remote monitoring and care delivery that conveniently manages conditions, and creates new standards of care.
We have three reportable segments that primarily develop, manufacture, distribute, and sell device-based medical therapies and services: the Cardiovascular Portfolio, the Neuroscience Portfolio, and the Medical Surgical Portfolio. In May 2025, the Company announced its intent to separate the Diabetes Business, with the intention to create a new independent, publicly traded company, MiniMed Group, Inc. (MiniMed). On March 9, 2026, MiniMed completed an initial public offering (the IPO). As a result, during the fourth quarter of fiscal year 2026, the Diabetes Operating Unit was no longer considered a reportable segment. For additional information regarding our segments, refer to the Business sections below and Note 19 to our consolidated financial statements in "Item 8. Financial Statements and Supplementary Data" of this Annual Report on Form 10-K.
Unless otherwise specified, the Company's business metrics presented in this report include our Diabetes Business. Such metrics may not be directly comparable to future periods following any separation of our Diabetes Business. Additionally, certain line items and metrics presented for the Diabetes Business in this report may not be directly comparable to those presented by our consolidated subsidiary, MiniMed, in its public filings. Investors are encouraged to review MiniMed's filings with the SEC for information regarding MiniMed's business and results. Any such filings are not incorporated by reference into this Annual Report on Form 10-K.
For additional information regarding the MiniMed separation, refer to Note 20 to our consolidated financial statements in "Item 8. Financial Statements and Supplementary Data" of this Annual Report on Form 10-K.
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CARDIOVASCULAR PORTFOLIO
The Cardiovascular Portfolio is made up of the Cardiac Rhythm & Heart Failure, Structural Heart & Aortic, and Coronary & Peripheral Vascular divisions. The primary medical specialists who use our Cardiovascular products include electrophysiologists, implanting cardiologists, heart failure specialists, cardiovascular, cardiothoracic, and vascular surgeons, and interventional cardiologists and radiologists.
Cardiac Rhythm & Heart Failure
Our Cardiac Rhythm & Heart Failure division includes the following Operating Units: Cardiac Rhythm Management and Cardiac Ablation Solutions. The division develops, manufactures, and markets products for the diagnosis, treatment, and management of heart rhythm disorders and heart failure. Our products include implantable devices, leads and delivery systems, products for the treatment of atrial fibrillation (AF), products designed to reduce surgical site infections, and information systems for the management of patients with Cardiac Rhythm & Heart Failure devices. Principal products and services offered include:
•Implantable cardiac pacemakers including the Azure MRI SureScan, XT and S models, Adapta, Attesta MRI SureScan, and the Micra transcatheter pacing system. Azure pacemakers feature Medtronic-exclusive BlueSync technology, which enables automatic, secure wireless remote monitoring with increased device longevity. The SelectSecure 3830 lead, with His-bundle and left bundle branch capabilities, effectively covers all current forms of conduction system pacing and sensing. The Micra transcatheter pacing system, which is leadless and does not have a subcutaneous device pocket like a conventional pacemaker, includes the Micra VR and the Micra AV device families. Both pacemakers treat patients with atrioventricular block.
•Implantable cardioverter defibrillators (ICDs), including the Aurora Extravascular-ICD, Visia AF MRI SureScan, Evera MRI SureScan, Primo MRI SureScan, and the Cobalt and Crome family of BlueSync-enabled ICDs, as well as defibrillator leads, including the Sprint Quattro Secure lead and OmniaSecure lead.
•Implantable cardiac resynchronization therapy devices (CRT-Ds and CRT-Ps) including the Claria/Amplia/Compia family of MRI Quad CRT-D SureScan systems and the Cobalt and Crome portfolio of BlueSync-enabled CRT-Ds, as well as the Percepta/Serena/Solara family of MRI Quad CRT-P SureScan systems.
•Cardiac ablation products include a full suite of electrophysiology solutions to treat patients with arrhythmias, including paroxysmal and persistent AF. The portfolio includes the PulseSelect and Affera Sphere-360 single shot pulsed field ablation catheters, the Affera Sphere-9 focal catheter, providing high density mapping capabilities combined with dual radio frequency and pulsed field energies to deliver ablation lesions, the Affera Mapping and Navigation System with Prism software aimed at integrating clinical information to improve patient outcomes, and the Arctic Front Advanced Cardiac Cryoablation System.
•Insertable cardiac monitoring systems, including the Reveal LINQ and LINQ II. These devices are for patients who experience transient symptoms such as dizziness, palpitation, syncope (fainting) and chest pain, as well as Cryptogenic Stroke patients, which may indicate a cardiac arrhythmia that requires long-term monitoring or ongoing management. Both portfolio devices have unmatched accuracy and a streamlined workflow with AccuRhythm AI algorithms to reduce clinic workload and data burden. LINQ II, the premium portfolio device, offers extended device longevity and remote programming capabilities.
•TYRX, an absorbable antibacterial mesh envelope used during implantation of cardiac rhythm management and neuromodulation devices to stabilize devices and help prevent infection.
•Remote monitoring services and patient-centered software to enable efficient care coordination as well as services related to hospital operational efficiency.
•Medtronic stopped the distribution and sale of the HVAD System in June 2021. We continue a support program for patients with HVAD devices, and for caregivers and healthcare professionals who participate in their care.
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Structural Heart & Aortic
Our Structural Heart & Aortic division includes the following Operating Units: Structural Heart & Aortic and Cardiac Surgery. The division includes therapies to treat heart valve disorders and aortic disease. Our devices include products for the repair and replacement of heart valves, perfusion systems, positioning and stabilization systems for beating heart revascularization surgery, surgical ablation products, and a comprehensive line of products and therapies to treat aortic disease, such as aneurysms, dissections, and transections. Principal products offered include:
•CoreValve family of aortic valves, including the Evolut PRO, Evolut PRO+, Evolut FX, and Evolut FX+ TAVR systems for transcatheter aortic valve replacement.
•Surgical valve replacement and repair products, including the Avalus Ultra surgical valve, for damaged or diseased heart valves, including both tissue and mechanical valves; blood-handling products that form a circulatory support system to maintain and monitor blood circulation and coagulation status, oxygen supply, and body temperature during arrested heart surgery; and surgical ablation systems and positioning and stabilization technologies.
•Endovascular stent grafts and accessories, including the Endurant II and Endurant IIs Stent Graft System for the treatment of abdominal aortic aneurysms, the Valiant Captivia Thoracic Stent Graft System for thoracic endovascular aortic repair procedures, and the Heli-FX EndoAnchor System.
•Transcatheter Pulmonary Valves, including Harmony Transcatheter Pulmonary Valve (TPV) and Delivery Catheter System and Melody TPV/Ensemble II Delivery System.
•Left atrial appendage exclusion systems to reduce the risk of stroke in patients with AF, including the Penditure LAA exclusion system.
•Extracorporeal Membrane Oxygenation (ECMO) systems to provide control of blood pumping through an extracorporeal circuit during ECMO procedures, including the VitalFlow ECMO system.
Coronary & Peripheral Vascular
Our Coronary & Peripheral Vascular division includes the following Operating Units: Coronary & Renal Denervation and Peripheral Vascular Health. The division is comprised of a comprehensive line of products and therapies to treat coronary artery disease as well as peripheral vascular disease and venous disease. Our products include coronary stents and related delivery systems, including a broad line of balloon angioplasty catheters, guide catheters, guide wires, diagnostic catheters, and accessories, peripheral drug coated balloons, stent and angioplasty systems, carotid embolic protection systems for the treatment of vascular disease outside the heart, and products for superficial and deep venous disease. Principal products offered include:
•Percutaneous Coronary Intervention products including our Neuroguard IEP carotid stenting system, Onyx Frontier and Resolute Onyx drug-eluting stents (DES), Euphora balloons, and Launcher guide catheters.
•Products to treat hypertension including our Symplicity Spyral renal denervation (RDN) system.
•Percutaneous angioplasty balloons including the IN.PACT family of drug-coated balloons, vascular stents including the Abre venous stent, directional atherectomy products including the HawkOne directional atherectomy system, the Liberant mechanical thrombectomy system, and other procedure support tools.
•Endovenous products to treat superficial venous diseases in the lower extremities including the ClosureFast radiofrequency ablation (RFA) system and the VenaSeal closure system.
NEUROSCIENCE PORTFOLIO
The Neuroscience Portfolio is made up of the Cranial & Spinal Technologies, Specialty Therapies, and Neuromodulation divisions. The primary medical specialists who use the products of this group include spinal surgeons, neurosurgeons, neurologists, pain management specialists, anesthesiologists, orthopedic surgeons, urologists, urogynecologists, interventional radiologists, and ear, nose, and throat specialists.
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Cranial & Spinal Technologies
Our Cranial & Spinal Technologies division and Operating Unit develops, manufactures, and markets an integrated portfolio of devices and therapies for surgical technologies designed to improve the precision and workflow of neurological procedures, and a comprehensive line of medical devices and implants used in the treatment of the spine and musculoskeletal system. The division also provides biologic solutions for the orthopedic markets and offers unique and highly differentiated imaging, navigation, power instruments, and robotic guidance systems used in spine and cranial procedures. Principal products and services offered include:
•Neurosurgery products, including platform technologies, implant therapies, and advanced energy products through the AiBLE spine technology ecosystem. This includes our StealthStation S8 surgical navigation system, Stealth Autoguide robotic guidance system, O-arm surgical imaging system, Mazor robotic guidance systems used in robot-assisted spine procedures, UNiD adaptive spine intelligence AI-driven technology for surgical planning and personalized spinal implants, and our Midas Rex surgical drills, including our MR8 high-speed drill system.
•Products to treat a variety of conditions affecting the spine, including degenerative disc disease, spinal deformity, spinal tumors, fractures of the spine, and stenosis. These products include our Catalyft PL and PL40 expandable interbody spacers, CD Horizon ModuLeX spinal system, and T2 Stratosphere expandable corpectomy system. These products can also include titanium interbody implants and surface technologies, such as our Adaptix interbody system and incorporated Titan interbody fusion device with nanoLOCK technology.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
UNDERSTANDING OUR FINANCIAL INFORMATION
The following discussion and analysis provides information management believes to be relevant to understanding the financial condition and results of operations of the Company. The discussion focuses on our financial results for the fiscal year ended April 24, 2026 (fiscal year 2026) and the fiscal year ended April 25, 2025 (fiscal year 2025). A discussion on our results of operations for fiscal year 2025 as compared to the fiscal year ended April 26, 2024 (fiscal year 2024) is included in Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended April 25, 2025, filed with the SEC on June 20, 2025, and is incorporated by reference into this Form 10-K. You should read this discussion and analysis along with our consolidated financial statements and related notes thereto at April 24, 2026 and April 25, 2025 and for fiscal years 2026, 2025, and 2024, which are presented within "Item 8. Financial Statements and Supplementary Data" in this Annual Report on Form 10-K. Amounts reported in millions within this annual report are computed based on the actual amounts, and therefore, the sum of the components may not equal the total amount reported in millions due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding.
Financial Trends
Throughout this Management’s Discussion and Analysis, we present certain financial measures that facilitate management's review of the operational performance of the Company and as a basis for strategic planning; however, such financial measures are not presented in our financial statements prepared in accordance with accounting principles generally accepted in the United States (U.S.) (U.S. GAAP). These financial measures are considered non-GAAP financial measures and are intended to supplement, and should not be considered as superior to, financial measures presented in accordance with U.S. GAAP. We believe that non-GAAP financial measures provide information useful to investors in understanding the Company's underlying operational performance and trends and may facilitate comparisons with the performance of other companies in the medical technologies industry.
As presented in the "GAAP to Non-GAAP Reconciliations" section on the following pages, our non-GAAP financial measures exclude the impact of amortization of intangible assets and certain charges or benefits that contribute to or reduce earnings and that may affect financial trends and include certain charges or benefits that result from transactions or events that we believe may or may not recur with similar materiality or impact to our operations in future periods (non-GAAP adjustments).
In the event there is a non-GAAP adjustment recognized in our operating results, the tax cost or benefit attributable to that item is separately calculated and reported. Because the effective rate can be significantly impacted by the non-GAAP adjustments that take place during the period, we often refer to our tax rate using both the effective rate and the non-GAAP nominal tax rate. The non-GAAP nominal tax rate is calculated as the income tax provision, adjusted for the impact of non-GAAP adjustments, as a percentage of income before income taxes, excluding non-GAAP adjustments.
Free cash flow is a non-GAAP financial measure calculated by subtracting property, plant, and equipment additions from operating cash flows.
Refer to the "GAAP to Non-GAAP Reconciliations," "Income Taxes," and "Free Cash Flow" sections for reconciliations of the non-GAAP financial measures to their most directly comparable financial measures prepared in accordance with U.S. GAAP.
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EXECUTIVE LEVEL OVERVIEW
The following is a summary of revenue, diluted earnings per share, and operating cash flow for fiscal years 2026 and 2025:
GAAP to Non-GAAP Reconciliations
The tables below present reconciliations of our non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with U.S. GAAP for fiscal years 2026 and 2025.
Fiscal Year 2026 | |||||||||||||||||||||||||||||
| (in millions, except per share data) | Income Before Income Taxes | Income Tax Provision (Benefit) | Net Income Attributable to Medtronic | Diluted EPS | Effective Tax Rate | ||||||||||||||||||||||||
| GAAP | $ | 6,136 | $ | 1,299 | $ | 4,801 | $ | 3.73 | 21.2 | % | |||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||
Amortization of intangible assets(1) | 1,772 | 329 | 1,444 | 1.12 | 18.6 | ||||||||||||||||||||||||
Restructuring and associated costs(2) | 370 | 80 | 290 | 0.23 | 21.6 | ||||||||||||||||||||||||
Acquisition and divestiture-related items(3) | 173 | 37 | 137 | 0.11 | 21.4 | ||||||||||||||||||||||||
| Certain litigation charges, net | 113 | 23 | 89 | 0.07 | 20.4 | ||||||||||||||||||||||||
(Gain)/loss on minority investments(4) | 131 | — | 130 | 0.10 | — | ||||||||||||||||||||||||
Other(5) | (39) | (8) | (30) | (0.02) | 20.5 | ||||||||||||||||||||||||
Certain tax adjustments, net(6) | — | (260) | 260 | 0.20 | — | ||||||||||||||||||||||||
| Non-GAAP | $ | 8,656 | $ | 1,499 | $ | 7,120 | $ | 5.53 | 17.3 | % | |||||||||||||||||||
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Fiscal Year 2025 | |||||||||||||||||||||||||||||
| (in millions, except per share data) | Income Before Income Taxes | Income Tax Provision (Benefit) | Net Income Attributable to Medtronic | Diluted EPS | Effective Tax Rate | ||||||||||||||||||||||||
| GAAP | $ | 5,628 | $ | 936 | $ | 4,662 | $ | 3.61 | 16.6 | % | |||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||
Amortization of intangible assets(1) | 1,807 | 335 | 1,471 | 1.14 | 18.5 | ||||||||||||||||||||||||
Restructuring and associated costs(2) | 303 | 65 | 238 | 0.18 | 21.5 | ||||||||||||||||||||||||
Acquisition and divestiture-related items(3) | 124 | 23 | 101 | 0.08 | 18.5 | ||||||||||||||||||||||||
| Certain litigation charges, net | 317 | 68 | 249 | 0.19 | 21.5 | ||||||||||||||||||||||||
(Gain)/loss on minority investments(4) | 213 | 26 | 185 | 0.14 | 12.2 | ||||||||||||||||||||||||
Medical device regulations(7) | 52 | 10 | 42 | 0.03 | 19.2 | ||||||||||||||||||||||||
Other(5) | 90 | 20 | 70 | 0.05 | 22.2 | ||||||||||||||||||||||||
Certain tax adjustments, net(6) | — | (62) | 62 | 0.05 | — | ||||||||||||||||||||||||
| Non-GAAP | $ | 8,533 | $ | 1,423 | $ | 7,079 | $ | 5.49 | 16.7 | % | |||||||||||||||||||
(1)The Company recognized $121 million and $151 million of accelerated amortization on certain intangible assets within the Cardiovascular Portfolio for fiscal years 2026 and 2025, respectively.
(2)The charges primarily relate to employee termination benefits, facility related and contract termination costs, and asset write offs.
(3)The charges primarily include business combination costs, changes in fair value of contingent consideration, exit of business-related charges, and gains related to certain business or asset sales. Exit of business-related charges primarily relate to the impending separation of the Diabetes Business and costs associated with the Company's June 2021 decision to stop the distribution and sale of the Medtronic HVAD System.
(4)We exclude unrealized and realized gains and losses on our minority investments as we do not believe that these components of income or expense have a direct correlation to our ongoing or future business operations.
(5)Reflects adjustments to the Company's Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court and the Legislative Decree published by the Italian government on June 30, 2025 for certain prior years since 2015.
(6)The net charges for fiscal year 2026 primarily relates to the impact of an intercompany sale of intellectual property, the net tax charge as a result of the separation of the Diabetes Business and amortization of previously established deferred tax assets arising from intercompany intellectual property transactions, which were partially offset by a tax benefit recognized due to a change in estimate of accrued interest on uncertain tax positions. The charges for fiscal year 2025 primarily includes amortization of previously established deferred tax assets from intercompany intellectual property transactions.
(7)The charges represent incremental costs of complying with the new European Union (E.U.) medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third-party expenses. We consider these costs to be duplicative of previously incurred costs and/or one-time costs.
Free Cash Flow
Free cash flow, a non-GAAP financial measure, is calculated by subtracting additions to property, plant, and equipment from net cash provided by operating activities. Management uses this non-GAAP financial measure, in addition to U.S. GAAP financial measures, to evaluate our operating results. Free cash flow should be considered supplemental to, and not a substitute for, our reported financial results prepared in accordance with U.S. GAAP. Reconciliations between net cash provided by operating activities (the most comparable U.S. GAAP measure) and free cash flow are as follows:
| Fiscal Year | |||||||||||
| (in millions) | 2026 | 2025 | |||||||||
| Net cash provided by operating activities | $ | 7,330 | $ | 7,044 | |||||||
| Additions to property, plant, and equipment | (1,904) | (1,859) | |||||||||
| Free cash flow | $ | 5,426 | $ | 5,185 | |||||||
Refer to the "Summary of Cash Flows" section for drivers of the change in cash provided by operating activities.
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Macroeconomic Trends
Looking ahead, a number of macroeconomic and geopolitical factors could negatively impact our business, including without limitation:
•Competitive product launches and pricing pressure, geographic macroeconomic developments including changes in global trade policies and fluctuations in currency exchange rates, general price inflation, changes in interest rates, reimbursement challenges, impacts from changes in the mix of our product offerings, delays in product registration approvals, national and provincial tender pricing for certain products, particularly in China, replacement cycle challenges, and supply chain challenges from time to time.
•Recent developments in global trade policy have introduced new uncertainties for our business. The U.S., China, and other jurisdictions have recently imposed or proposed additional tariffs on imported goods. Based on current rates as of June 3, 2026, we estimate the pre-tax net tariff impact to be $250 million in fiscal year 2027, excluding any considerations of government refunds. The actual amount could vary based on changes in tariff rates, duration of tariffs, scope of tariffs, and potential countermeasures or mitigation actions. While we are taking proactive steps to mitigate the effects of these tariffs, the evolving nature of international trade policy continues to present a risk to our cost structure and financial performance. Further escalation or expansion of trade barriers could have a material adverse effect on our results of operations. On February 20, 2026, the U.S. Supreme Court ruled that President Trump's tariff policies under the International Emergency Economic Powers Act ("IEEPA") are unconstitutional. As a result of this ruling, the U.S. Court of International Trade issued an order directing the U.S. Customs and Border Protection ("CBP") agency to begin formalizing a process for refunds. On April 20, 2026, the CBP launched an online portal that can be used to submit IEEPA tariff refund requests. All requests will be reviewed by the CBP to determine validity prior to the issuance of refunds. We continue to monitor the situation and the impact to our results of operations.
•The sanctions and other measures being imposed in response to the Russia-Ukraine conflict are having and could continue to have impacts on revenue and supply chain. The financial impact of the conflict in fiscal year 2026, including on accounts receivable and inventory reserves, was not material. For fiscal year 2026, the business of the Company in these countries represented less than 1% of the Company's consolidated revenues and assets.
•Although the long-term implications of Israel's conflict are difficult to predict at this time, the financial and operational impact of the conflict in fiscal year 2026, including on accounts receivable and inventory reserves, was not material. As of April 24, 2026, the Company had 6 facilities and approximately 1,200 employees in Israel. For fiscal year 2026, the business of the Company in Israel represented less than 1% of the Company's consolidated revenues and assets.
•Ongoing conflict in the Middle East may continue to disrupt global supply chains and contribute to higher energy, fuel, and transportation costs. Continued instability in the region may further increase costs and create operational challenges.
•The planned exit of certain businesses, including our Diabetes Business, may involve separation activities, costs, and risks associated with transitioning operations, arrangements, and infrastructure. The timing and execution of these activities, as well as any related disposition steps, could affect our future results and financial condition.
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NET SALES
Starting in the fourth quarter of fiscal year 2026, the Diabetes Business is no longer considered a reportable segment. Prior period net sales have been recast to conform to the new presentation. The charts below illustrate the percent of net sales by business for fiscal years 2026 and 2025:
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The table below includes net sales by segment and division and market geography for fiscal years 2026 and 2025:
| Net Sales by Fiscal Year | Percent Change | |||||||||||||||
| (in millions) | 2026 | 2025 | ||||||||||||||
| Cardiac Rhythm & Heart Failure | $ | 7,504 | $ | 6,392 | 17 | % | ||||||||||
| Structural Heart & Aortic | 3,817 | 3,554 | 7 | |||||||||||||
| Coronary & Peripheral Vascular | 2,656 | 2,535 | 5 | |||||||||||||
| Cardiovascular | 13,976 | 12,481 | 12 | |||||||||||||
| Cranial & Spinal Technologies | 5,222 | 4,973 | 5 | |||||||||||||
| Specialty Therapies | 2,997 | 2,940 | 2 | |||||||||||||
| Neuromodulation | 2,068 | 1,932 | 7 | |||||||||||||
| Neuroscience | 10,287 | 9,846 | 4 | |||||||||||||
| Surgical & Endoscopy | 6,764 | 6,498 | 4 | |||||||||||||
| Acute Care & Monitoring | 2,051 | 1,909 | 7 | |||||||||||||
| Medical Surgical | 8,815 | 8,407 | 5 | |||||||||||||
| Reportable segment net sales | 33,079 | 30,734 | 8 | |||||||||||||
| Diabetes | 3,112 | 2,755 | 13 | |||||||||||||
Other operating segment(1) | 135 | 137 | (1) | |||||||||||||
Other adjustments(2) | 39 | (90) | NM(3) | |||||||||||||
| Total net sales | $ | 36,364 | $ | 33,537 | 8 | % | ||||||||||
| U.S. | International | |||||||||||||||||||||||||||||||||
| (in millions) | Fiscal Year 2026 | Fiscal Year 2025 | % Change | Fiscal Year 2026 | Fiscal Year 2025 | % Change | ||||||||||||||||||||||||||||
| Cardiovascular | $ | 6,435 | $ | 5,804 | 11 | % | $ | 7,541 | $ | 6,677 | 13 | % | ||||||||||||||||||||||
| Neuroscience | 6,875 | 6,713 | 2 | 3,412 | 3,133 | 9 | ||||||||||||||||||||||||||||
| Medical Surgical | 3,778 | 3,664 | 3 | 5,037 | 4,744 | 6 | ||||||||||||||||||||||||||||
| Reportable segment net sales | 17,088 | 16,181 | 6 | 15,991 | 14,553 | 10 | ||||||||||||||||||||||||||||
| Diabetes | 934 | 923 | 1 | 2,178 | 1,832 | 19 | ||||||||||||||||||||||||||||
Other operating segment(1) | 81 | 68 | 19 | 54 | 70 | (23) | ||||||||||||||||||||||||||||
Other adjustments(2) | — | — | — | 39 | (90) | NM(3) | ||||||||||||||||||||||||||||
| Total net sales | $ | 18,103 | $ | 17,171 | 5 | % | $ | 18,261 | $ | 16,365 | 12 | % | ||||||||||||||||||||||
(1)Includes operations and ongoing transition agreements from businesses the Company has exited or divested.
(2)Reflects adjustments to the Company's Italian payback accruals as further described below.
(3)Not meaningful (NM)
The increase in net sales for fiscal year 2026 was driven primarily by growth in most businesses, as further described in the business sections below. In addition, the net sales increase was driven by impacts of foreign currency fluctuations and changes in estimates relating to our Italian payback accrual resulting from the two July 2024 rulings by the Constitutional Court and the Legislative Decree published by the Italian government in June 2025 and formalized into law in August 2025 for certain prior years since 2015. For fiscal year 2026, the impact of the Italian payback adjustment was an increase to net sales of $39 million as compared to a decrease in net sales of $90 million in fiscal year 2025.
Cardiovascular
Cardiovascular products include pacemakers, insertable cardiac monitors, cardiac resynchronization therapy devices, implantable cardioverter defibrillators, leads and delivery systems, products for the treatment of atrial fibrillation, information systems for the management of patients with Cardiac Rhythm & Heart Failure devices, products designed to reduce surgical site infections, coronary and peripheral stents and related delivery systems, balloons and related delivery systems, endovascular stent graft systems, heart valve replacement technologies, cardiac tissue ablation systems, open heart and coronary bypass grafting surgical products, and renal denervation systems for the treatment of hypertension. Cardiovascular also includes Care Management Services and Cath Lab Managed Services (CLMS) within the Cardiac Rhythm & Heart Failure division. Cardiovascular's net sales for fiscal year 2026 were $14.0 billion, an increase
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of 12 percent as compared to fiscal year 2025. The net sales increase was primarily due to growth across most businesses and the impacts of foreign currency fluctuations.
The charts below illustrate the percent of Cardiovascular net sales by division for fiscal years 2026 and 2025:
Cardiac Rhythm & Heart Failure (CRHF) net sales increased 17 percent in fiscal year 2026 as compared to fiscal year 2025. Cardiac Ablation Solutions experienced strong growth in the pulsed ablation portfolio with partially offsetting declines in cryoablation. Net sales growth was also due to increases within Cardiac Rhythm Management, driven by growth in Micra leadless pacemakers, Aurora extravascular implantable cardioverter defibrillator (EV-ICD) system, and SelectSecure 3830 lead.
Structural Heart & Aortic (SHA) net sales increased 7 percent in fiscal year 2026 as compared to fiscal year 2025. The net sales increase was driven by Structural Heart and in Cardiac Surgery driven by growth in Penditure LAA exclusion system, Avalus Ultra surgical valve, and VitalFlow ECMO system.
Coronary & Peripheral Vascular (CPV) net sales increased 5 percent in fiscal year 2026 as compared to fiscal year 2025. The net sales increase was driven by growth in the Symplicity Spyral renal denervation system, guide catheters and balloons, as well as growth in Peripheral Vascular Health from Endovenous. The net sales increase was partially offset by declines in coronary stents.
In addition to the macroeconomic and geopolitical factors described in the Executive Level Overview, looking ahead, we expect Cardiovascular could be affected by the following:
•Continued global penetration of our Micra transcatheter pacing portfolio.
•Continued acceptance and growth of the 3830 lead.
•Global adoption and growth of Aurora EV-ICD.
•Growth of the Cobalt and Crome portfolio of ICDs and CRT-Ds.
•Continued growth and utilization of the TYRX Envelope for implantable devices.
•Continued use and acceptance of Reveal LINQ and expansion of the LINQ II cardiac monitor.
•Continued acceptance, adoption, and growth of our innovative portfolio of products in the electrophysiology (EP) segment, including the PulseSelect pulsed field ablation system and the Affera mapping and ablation system with Sphere-9 catheter. The Affera mapping and ablation system and Sphere-9 catheter received U.S. FDA approval in late October 2024.
•Continued growth and market acceptance of Affera Sphere-360 pulsed field ablation single-shot catheter. The catheter received CE Mark in January 2026.
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•Continued acceptance and growth of the self-expanding CoreValve Evolut transcatheter aortic valve replacement (TAVR) platform. This includes Evolut PRO which provides enhanced hemodynamics, reliable delivery, enhanced durability, advanced sealing, and Evolut FX, a system designed to improve the overall procedural experience through enhancements in deliverability, implant visibility, and deployment stability. The Evolut FX+ TAVR system maintains the valve performance benefits of the legacy Evolut TAVR platform and is designed to facilitate coronary access. The system was approved by the U.S. FDA in March 2024 and received CE Mark in late October 2024.
•Market acceptance and reimbursement for the Symplicity Spyral renal denervation system, also known as the Symplicity blood pressure procedure, for the treatment of hypertension. The U.S. Centers for Medicare and Medicaid Services (CMS) finalized National Coverage Determination in October 2025.
•Market acceptance and growth of the Penditure LAA Exclusion System. The system received CE Mark in October 2025.
•Continued acceptance and growth of the Onyx Frontier drug-eluting stent (DES) platform. Onyx Frontier is a DES that introduces an enhanced delivery system and is used for complex percutaneous coronary intervention (PCI).
•Strengthening our position in the Coronary & Peripheral Vascular division as a result of the April 2026 acquisition of CathWorks Ltd. The acquisition expands the CPV division by aiming to transform how coronary artery disease is diagnosed and treated.
•Acceptance and growth of IN.PACT 018 drug-coated balloons (DCB). IN.PACT 018 adds to the existing IN.PACT Admiral DCB portfolio and is used to treat femoropopliteal disease.
•Market growth of Liberant mechanical thrombectomy system.
•Market acceptance and growth of OmniaSecure defibrillation lead. OmniaSecure received CE Mark in March 2026.
•Market acceptance and growth of the Neuroguard IEP carotid stenting system.
•Our ability to meet growing demand for our existing products and to successfully develop, obtain regulatory approval of, and commercialize the products within our pipeline, including VT indication expansion for Sphere 9 and commercialization of Affera Sphere-360 pulsed field ablation single-shot catheter.
Neuroscience
Neuroscience's products include various spinal implants, bone graft substitutes, biologic products, image-guided surgery and intra-operative imaging systems, robotic guidance systems used in the robot-assisted spine procedures, and systems that incorporate advanced energy surgical instruments. Neuroscience's products also focus on therapies to treat the diseases of the vasculature in and around the brain, including coils, neurovascular stents, and flow diversion products, as well as products to treat the ear, nose, and throat (ENT), and the treatment of overactive bladder and urinary retention. Neuroscience also manufactures products related to implantable neurostimulation therapies and drug delivery systems for the treatment of chronic pain, movement disorders, and epilepsy. Neuroscience’s net sales for fiscal year 2026 were $10.3 billion, an increase of 4 percent as compared to fiscal year 2025, resulting from growth in Cranial and Spinal Technologies, Neuromodulation, ENT, and the impacts of foreign currency fluctuations.
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The charts below illustrate the percent of Neuroscience net sales by division for fiscal years 2026 and 2025:
Cranial & Spinal Technologies (CST) net sales for fiscal year 2026 increased 5 percent as compared to fiscal year 2025. The net sales increase was driven by the continued adoption of the AiBLE ecosystem of spine implants and enabling technology with growth in Core Spine and Neurosurgery.
Specialty Therapies (Specialty) net sales for fiscal year 2026 increased 2 percent as compared to fiscal year 2025. The net sales increase was driven by growth in ENT and Flow Diversion, offset by Pelvic Health and the Pipeline Vantage recall.
Neuromodulation (NM) net sales for fiscal year 2026 increased 7 percent as compared to fiscal year 2025. The net sales increase was driven by the Inceptiv closed-loop spinal cord stimulator, the Percept RC neurostimulator with BrainSense technology, and Interventional.
In addition to the macroeconomic and geopolitical factors described in the Executive Level Overview, looking ahead we expect Neuroscience could be affected by the following:
•Continued global adoption, growth, and market acceptance of integrated solutions through the AiBLE offering, which integrates spinal implants with enabling technologies (StealthStation, O-arm Imaging Systems, and Midas), Mazor robotics, and UNiD Adaptive Spine Intelligence AI-driven technology for surgical planning and personalized spinal implants. The Stealth AXiS Surgical System received U.S. FDA approval for spinal procedures in February 2026, followed by expanded approval for cranial and ENT applications in March 2026. The system received CE mark approval for spinal and cranial procedures in April 2026, and for ENT procedures in June 2026. The system incorporates navigation workflows with a modular robotic architecture.
•Market acceptance and continued global adoption of innovative spine products and procedural solutions within our CST operating unit, such as Catalyft PL & PL40, CD Horizon ModuLeX and Voyager Systems, and our Infinity OCT System, as well as continued growth from Titan spine titanium interbody implants with Nanolock technology.
•Continued global growth of commercially available Pipeline Embolization Devices, endovascular treatments for certain wide-necked brain aneurysms.
•Continued global acceptance of the Solitaire X revascularization device for treatment of acute ischemic stroke and our React Catheter and Riptide aspiration system.
•Continued global acceptance and growth of our Pelvic Health therapies, including our InterStim therapy with InterStim X and InterStim II recharge-free neurostimulators and InterStim Micro rechargeable neurostimulator for patients suffering from overactive bladder, (non-obtrusive) urinary retention, and chronic fecal incontinence. The Altaviva implantable tibial neuromodulation system received U.S. FDA approval in September 2025 for urinary urge incontinence.
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•Continued global adoption, growth, and market acceptance of our ENT therapies, including the intraoperative NIM nerve monitoring system, the Propel sinus implants used in the treatment of chronic rhinosinusitis, and global capital equipment sales of the StealthStation ENT surgical navigation system and the U.S. FDA approved Stealth AXiS Surgical System for ENT applications, which received approval in March 2026, followed by CE mark approval in June 2026.
•Continued global acceptance and growth from spinal cord stimulation (SCS) therapy for treating chronic pain and Diabetic Peripheral Neuropathy (DPN) on the Inceptiv closed-loop rechargeable neurostimulator, Intellis rechargeable neurostimulator and Vanta recharge-free neurostimulator.
•Continued global acceptance and growth of our Percept family of deep brain stimulation (DBS) devices with proprietary BrainSense technology for objectifying and personalizing the treatment of Parkinson's Disease, epilepsy, and other movement disorders. BrainSense Adaptive DBS and BrainSense Electrode Identifier received CE Mark in January 2025 and U.S. FDA approval in February 2025.
•Continued market acceptance and growth of the Neuroguard IEP carotid stenting system.
•The acquisition of Scientia Vascular and pending acquisition of SPR Therapeutics, which will expand the Neuroscience Portfolio. Refer to Acquisitions and Dispositions for additional information.
•Our ability to meet growing demand for our existing products and to successfully develop, obtain regulatory approval of, and commercialize the products within our pipeline, which include the hemorrhagic stroke device, our next-generation spine enabling technologies, and the implantable tibial bladder control stimulator.
Medical Surgical
Medical Surgical’s products span the entire continuum of patient care from diagnosis to recovery, with a focus on diseases of the gastrointestinal tract, lungs, pelvic region, obesity, and preventable complications. The products include those for advanced and general surgical products, surgical stapling devices, vessel sealing instruments, wound closure, electrosurgery products, hernia mechanical devices, mesh implants, advanced ablation, interventional lung, airway products, and sensors and monitors for pulse oximetry, capnography, level of consciousness and cerebral oximetry. Medical Surgical’s net sales for fiscal year 2026 were $8.8 billion, an increase of 5 percent as compared to fiscal year 2025, resulting from growth across most businesses and the impacts of foreign currency fluctuations.
The charts below illustrate the percent of Medical Surgical net sales by division for fiscal years 2026 and 2025:
Surgical & Endoscopy (SE) net sales for fiscal year 2026 increased 4 percent as compared to fiscal year 2025. The net sales increase was primarily due to growth in Surgical, with strength in LigaSure vessel-sealing technology, ProGrip self-gripping polyester mesh, V-Loc
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barbed sutures, Electrosurgery, and Surgical Robotics. The growth in Surgical was partially offset by Advanced Stapling due to shifts to robotic surgery and bariatric procedure declines. The net sales increase was also driven by growth in Endoscopy driven by Nexpowder endoscopic hemostasis system and Endoflip 300 system.
Acute Care & Monitoring (ACM) net sales for fiscal year 2026 increased 7 percent as compared to fiscal year 2025. The net sales increase was primarily due to growth in Nellcor pulse oximetry, McGRATH MAC video laryngoscope, and BIS and INVOS advanced monitoring sensors.
In addition to the macroeconomic and geopolitical factors described in the Executive Level Overview, looking ahead we expect Medical Surgical could be affected by the following:
•Acceptance and continued growth of Open-to-MIS (minimally invasive surgery) techniques and tools through our efforts to transition open surgery to MIS. Open-to-MIS initiative focuses on capturing the market opportunity that exists in transitioning open procedures to MIS, whether through traditional MIS, advanced instrumentation, or robotics. Through our approach, in parallel, we also expand our presence and optimize open surgery in current open surgery markets.
•Continued global acceptance and future growth of powered stapling and energy platform.
•Our ability to execute ongoing strategies addressing the pressures to bariatric surgery procedure volumes in the U.S. from pharmaceuticals, and growth of surgical soft tissue robotics procedures in the U.S.
•Our ability to create markets and drive products and procedures into emerging markets with our high quality and cost-effective surgical products designed for customers in emerging markets.
•Continued acceptance and growth in patient monitoring and airway management. Key products in this area include Microstream Capnography, Nellcor pulse oximetry system with OxiMax technology, Shiley tracheostomy and endotracheal tubes, and McGRATH MAC video laryngoscopes.
•Acceptance of less invasive standards of care in chronic and colorectal, as well as hepatology products, including products that span the care continuum from diagnostics to therapeutics.
•Expanding the use of less invasive treatments and furthering our commitment to improving options for women with abnormal uterine bleeding. Our expanded and strengthened surgical offerings complement our global gynecology business.
•Global adoption of robotic-assisted surgery and the safe and effective use of the Hugo robotic assisted surgery (RAS) system, including system reliability and acceptability, for urologic, bariatric, gynecologic, hernia, and general surgery procedures. This includes continued integration and adoption of Touch Surgery Enterprise with the first artificial intelligence (AI) powered surgical videos and analytics platform to make it easier to analyze performance, train, and discover new techniques within the robotics platform. The Hugo RAS system is designed to help reduce unwanted variability, improve patient outcomes, and, by extension, lower per procedure cost. LigaSure RAS vessel-sealing technology received CE Mark in July 2025, expanding Hugo RAS system capabilities for gynecologic, general, and urologic procedures. The Hugo RAS system received U.S. FDA clearance for use in urologic surgical procedures in December 2025.
•Our ability to meet growing demand for our existing products and to successfully develop, obtain regulatory approval of, and commercialize the products within our pipeline, which includes general surgery and gynecology indications for our Hugo RAS system in the U.S., the adoption of AI in Endoscopy and Digital Surgical Technologies, Signia powered stapling devices, and our next-gen LigaSure and Sonicision vessel sealing devices.
Diabetes
Diabetes' products primarily include insulin pumps, continuous glucose monitoring (CGM) systems, and consumables. Diabetes' net sales for fiscal year 2026 were $3.1 billion, an increase of 13 percent as compared to fiscal year 2025. The increase in net sales was primarily driven by strong international growth due to the continued adoption of the MiniMed 780G AID system, including the Simplera Sync and Guardian 4 CGM sensors, Extended Infusion Sets, and the impacts of foreign currency fluctuations.
Refer to the Executive Level Overview for other factors that could impact the Diabetes Business.
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COSTS AND EXPENSES
The following is a summary of cost of products sold, research and development, and selling, general, and administrative expenses as a percent of net sales:
Cost of Products Sold Cost of products sold for fiscal year 2026 was $12.7 billion as compared to $11.6 billion for fiscal year 2025. Cost of products sold as a percentage of net sales increased as compared to the prior fiscal year. The increase in cost of products sold as a percentage of net sales was primarily due to $185 million of increased tariffs and duties on imported goods and $84 million of asset write offs. The increase in costs of products sold as a percentage of net sales was partially offset by net favorable impact of currency on net sales and cost of products sold in addition to changes in the Italian payback accruals impacting net sales. For additional information about the asset write offs, refer to Note 4 to our consolidated financial statements in "Item 8. Financial Statements and Supplementary Data" of this Annual Report on Form 10-K. Looking ahead, we anticipate incurring additional costs related to current imposed and proposed tariffs. For additional information on tariffs and duties, refer to the Executive Level Overview.
Research and Development Expense We remain committed to deliver the best possible experiences for patients, physicians, and caregivers we serve; to create technologies that expand what’s possible across the human body to transform lives; to turn data and insights into real action to serve patient needs, improving care; and to expand healthcare access and deliver positive outcomes. Research and development expense for fiscal year 2026 was $2.9 billion as compared to $2.7 billion for fiscal year 2025.
Selling, General, and Administrative Expense Our goal is to continue to leverage selling, general, and administrative expense management initiatives. Selling, general, and administrative expense primarily consists of salaries and wages, other administrative costs, such as professional fees and marketing expenses, and certain acquisition and divestiture-related costs. Selling, general, and administrative expense for fiscal year 2026 was $11.8 billion as compared to $10.8 billion for fiscal year 2025. The increase in selling, general, and administrative expense was primarily due to selling expenses in line with sales growth, new product launches and related commercialization activities, and increased expenses to support the impending separation of the Diabetes Business.
The following is a summary of other costs and expenses (income):
| Fiscal Year | |||||||||||
| (in millions) | 2026 | 2025 | |||||||||
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-07-08 | Walter Matthew R. | SVP, Chief HR Officer | Sell | -3,102 | $83.15 | -$257,931 |
| 2026-06-08 | KIIL HARRY SKIP | EVP & President Cardiovascular | Sell | -4,189 ×2 | $80.44 | -$336,965 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-08-25 10-Q expected by 2026-09-02 (in 2 days)
- ~2026-11-24 10-Q expected by 2026-12-02 (in 93 days)
- ~2027-02-23 10-Q expected by 2027-03-03 (in 184 days)
- ~2027-06-17 10-K expected by 2027-06-21 (in 298 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-08-17 DEF 14A Proxy Statement
- 2026-06-18 10-K Annual Report
- 2026-06-03 8-K Earnings Release; Financial Statements and Exhibits
- 2026-05-18 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-02-24 10-Q Quarterly Report
- 2026-02-17 8-K Earnings Release; Financial Statements and Exhibits
- 2025-11-25 10-Q Quarterly Report
- 2025-11-18 8-K Earnings Release; Financial Statements and Exhibits
- 2025-11-03 8-K Officer/Director Change
- 2025-09-29 8-K Material Agreement Entered; Other Events; Financial Statements and Exhibits
- 2025-09-16 8-K Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-08-26 10-Q Quarterly Report
- 2025-08-19 8-K Earnings Release; Officer/Director Change; Financial Statements and Exhibits
- 2025-06-23 8-K Officer/Director Change
- 2025-06-20 10-K Annual Report