Edwards Lifesciences stock shot higher Thursday after the heart-focused medtech player boosted some elements of its 2025 outlook, shrugging off concerns that tariffs will hugely impact its 2025 financials.
The Irvine, Calif.-based company is known for its transcatheter aortic heart-valve replacements, or TAVR, technology. This is a means of replacing a faulty heart valve by threading a device through a blood vessel — often in the leg — to avoid open-heart surgery.
Edwards reiterated its forecast for TAVR to generate $4.1 billion to $4.4 billion in full-year sales.
But the company expects its transcatheter mitral and tricuspid therapies division to bring in $530 million to $550 million in sales, up $25 million at the midpoint from its previous guidance. This segment also uses minimally invasive methods to treat conditions of the mitral and tricuspid heart vales. It also boosted its full year sales outlook by $100 million to account for movement in exchange rates.
Edwards also guided to $2.40 to $2.50 in adjusted earnings per share this year.
Edwards Lifesciences stock jumped 6.6%, closing at 75.11. Shares are forming a flat base with a buy point at 76.73, according to MarketSurge.
TAVR Growth Drives Sales Beat
Across all products, sales grew 6.2% on a strict, as-reported basis to $1.41 billion. On an adjusted basis, sales climbed 7.9%. Analysts projected $1.4 billion in sales. Adjusted earnings grew more than 5%, coming in at 61 cents per share. That beat projections by a penny.
"Strength this quarter was driven by better-than-expected TAVR growth despite having one less selling day and continued momentum in TMTT (transcatheter mitral and tricuspid therapies)," William Blair analyst Margaret Kaczor Andrew said in a note.
Notably, the company says its guidance already includes the potential for tariffs and the estimated dilution from acquiring JenaValve technology. JenaValve is working on a transcatheter treatment for aortic regurgitation, a condition in which the heart's aortic valve doesn't close properly.
Tariffs Will Be A 2026 Problem
But there's a possibility its gross and operating margins could be squeezed by the weakening dollar, tariffs and the JenaValve acquisition. For now, Edwards maintained its 78% to 79% gross margin guide for the full year. The company calls for a 5-cent hit to earnings per share in 2025.
Edwards Lifesciences already has a lot of its production in the U.S. According to FactSet, more than half of Edwards' sales, nearly 59%, stemmed from the U.S. in 2024. Roughly a quarter, 24.3%, came from Europe with 10.5% coming from the rest of the world.
"The bigger impact is in 2026, but it's premature to be offering any guidance or speculation about what tariffs could look like when we get out there," Chief Financial Officer Scott Ullem said on the company's earnings call with analysts late Wednesday.
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