IRVINE, Calif. - Edwards Lifesciences (NYSE: NYSE:EW), a global leader in patient-focused innovations for structural heart disease and critical care monitoring, reported its financial results for the second quarter ended June 30, 2024.
Despite delivering an adjusted EPS of $0.70, surpassing the analyst estimate by $0.01, the company's revenue fell short of expectations, coming in at $1.63 billion against the consensus estimate of $1.65 billion. Following the announcement, shares of Edwards Lifesciences dropped by 10%.
The company's second-quarter performance showed a 7% growth in sales, with a notable 75% surge in Transcatheter Mitral and Tricuspid Therapies (TMTT) sales, which are increasingly contributing to Edwards' growth. However, Transcatheter Aortic Valve Replacement (TAVR) sales experienced lower-than-expected growth, leading to a revised full-year outlook. Edwards now anticipates TAVR sales growth of 5 to 7%, down from the previous guidance of 8 to 10%.
Bernard Zovighian, CEO of Edwards Lifesciences, commented on the quarter's achievements and the revised outlook, stating, "Second quarter total company sales growth of 8 percent reflected strong contributions from our rapidly growing TMTT product group, offset by lower-than-expected growth in TAVR." He added, "Edwards is well-positioned to deliver sustainable TAVR growth in 2025 and beyond, driven by advancements in our leading SAPIEN platform, indication expansions to much larger populations of patients, and improving patient access to this important therapy."
Despite the revenue shortfall, the company reported several positive developments, including the successful introduction of the EVOQUE system and the initiation of the National Coverage Decision (NCD) process for transcatheter tricuspid valve replacement by the Centers for Medicare & Medicaid Services (CMS). Additionally, the sale of the Critical Care product group is expected to close in late Q3 2024.
Looking ahead, Edwards expects Q3 sales of $1.56 to $1.64 billion, with EPS in the range of $0.67 to $0.71, assuming the inclusion of Critical Care and no impact from previously announced acquisitions. The company's full-year sales guidance has been adjusted, with TMTT sales now expected to reach the higher end of the previous $320 to $340 million range.
The company's continued investment in innovation is evident in the adjusted research and development expenses, which totaled $303 million, or 18.6% of sales, reflecting ongoing investments in transcatheter valve innovations and clinical trial activity.
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