Medtronic's revenue rose 13.7% to $9.76B, about 7% organic once an extra week is excluded, as electrophysiology sales jumped 29.5% on pulsed field ablation. GAAP EPS rose to $1.14 from $0.81 and FY27 guidance was raised.
Revenue
$9.8B
+13.7% YoY
Net income
$1.5B
+41.4% YoY
Diluted EPS
$1.14
+40.7% YoY
Operating margin
18.1%
Heart-rhythm products carried a quarter that also got an extra week
Medtronic's fiscal first quarter of 2027 (the three months ended July 31, 2026; Medtronic's fiscal year runs to late April) brought in $9.756 billion in revenue, up 13.7% from $8.578 billion a year earlier. GAAP net income attributable to Medtronic rose 41.4% to $1.470 billion, and diluted EPS rose from $0.81 to $1.14.
Two things drive those headline numbers, and they need to be separated:
An extra week. Fiscal 2027 has 53 weeks instead of 52, and the extra week fell in this quarter. Medtronic estimates it added about $570 million of sales. By our arithmetic on the company's organic figures (organic sales rose $1,163 million, from $8,489 million to $9,652 million), taking out that week leaves underlying organic growth of roughly 7%, not 13.7%. The 7% figure is the one to compare with the full-year outlook.
Electrophysiology. This is the division that treats heart-rhythm problems, from ablation catheters to pacemakers and defibrillators. Its sales rose 29.5% to $2.218 billion (41.2% in the U.S.). That $506 million increase is about 43% of the company's entire $1.178 billion revenue gain. The 10-Q attributes it to "growth in the pulsed field ablation portfolio" plus pacing and defibrillation. The earnings release puts Cardiac Ablation Solutions up 88% and Cardiac Rhythm Management up 15% (both organic). Pulsed field ablation treats atrial fibrillation, a common irregular heartbeat, by using short electrical pulses rather than heat or cold to disable the heart tissue that misfires. Medtronic sells it through the PulseSelect system and the Affera mapping system with Sphere-9 and Sphere-360 catheters.
GAAP profit grew much faster than sales mostly for reasons outside day-to-day operations. We explain those below.
Key figures
Metric
Q1 FY27 (to Jul 31, 2026)
Q1 FY26 (to Jul 25, 2025)
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Organic growth is Medtronic's measure of sales growth with currency swings, acquisitions/divestitures and a residual "Other" line (exited businesses and Italian payback accrual adjustments) stripped out. Prior-year segment figures are recast for this year's new divisional structure.
Segments: two grew profit faster than sales, one did not
Segment
Revenue
Reported growth
Organic growth
Segment operating profit
Profit YoY
Segment margin (vs. prior year)
Cardiovascular
$3,927M
+19.5%
+18.9%
$1,033M
+24.8%
26.3% (25.2%)
Neuroscience
$2,678M
+10.3%
+9.3%
$793M
+11.2%
29.6% (29.4%)
Medical Surgical
$2,279M
+10.0%
+10.2%
$485M
-0.2%
21.3% (23.4%)
Diabetes (MiniMed, not a reportable segment)
$843M
+16.9%
+14.9%
n/a
n/a
n/a
Segment operating profit is Medtronic's own measure of each unit's profit before amortization, interest, and costs the company does not allocate to segments. Margins are our calculation from the 10-Q's segment table.
Cardiovascular gained profit faster than sales, and electrophysiology did most of the work. The other three divisions grew in single to low-double digits: Interventional Cardiology +7.2% (TAVR, meaning catheter-delivered replacement heart valves, plus the Symplicity renal denervation blood-pressure procedure), CardioVascular Surgery +9.3% and Peripheral Vascular Health +11.6%. U.S. Interventional Cardiology sales actually slipped 0.8%.
Neuroscience grew 9.3% organically. Cranial & Spinal Technologies grew 12.9% organic on "continued adoption of the AiBLE ecosystem of spine implants and enabling technology." Specialty Therapies reported +10.2%, but $14 million of that came from the newly bought Scientia Vascular, so it was +7.4% organic. The 10-Q says the new Altaviva bladder-control stimulator helped Specialty, and so did ENT and neurovascular growth, while a Pipeline Vantage recall held it back. Neuromodulation grew only 3.3% organically.
Medical Surgical is the weak spot on profit. Sales rose 10% (LigaSure vessel sealing, sutures, mesh, the Hugo surgical robot, Nellcor pulse oximetry). Even so, segment operating profit was flat at $485 million because product costs rose 13% and SG&A rose 12.6%, both faster than revenue. The 10-Q does not break out the cause for this segment. Spending to launch Hugo in the U.S. (FDA-cleared for urologic surgery in December 2025) is a plausible contributor, but that is our inference, not the filing's.
Why GAAP profit grew about three times faster than sales
Operating profit rose 22.1%, and pre-tax income rose 35.9% ($1,769M vs $1,302M). Most of the gap comes from items management itself excludes from its "non-GAAP" (adjusted) figures:
Minority investments swung. Medtronic booked a $64 million gain on minority stakes this quarter, compared with a $113 million loss a year ago. That is a $177 million pre-tax swing that says nothing about the core business.
Amortization fell. Amortization of intangibles (the accounting write-down of acquired patents and technology) dropped to $412 million from $459 million. The prior year included $45 million of accelerated amortization in Cardiovascular.
The tax rate fell. The effective tax rate dropped to 16.4% from 19.6%.
On the adjusted basis, which removes those items, EPS rose a more modest 15.1% to $1.45. The adjusted operating margin (the share of revenue left after operating costs) edged up only 0.1 point, to 23.7%. That is notable. An extra week of sales ought to improve margins because many costs are fixed. Instead, gross margin was flat at 65.0%: the 10-Q says "favorable pricing and cost-down initiatives" were "partially offset by unfavorable mixes." SG&A rose 14.0%, slightly faster than sales, which the filing puts down to "increased selling expenses in line with sales growth and new product launches." Other operating expense also rose to $123 million from $70 million, mainly because income from R&D funding arrangements fell. The filing says tariffs had no material year-over-year effect once refunds are counted (the Supreme Court struck down the IEEPA tariffs in February 2026).
Currency helped a little. Foreign exchange added $57 million to sales and about $0.02 to adjusted EPS ($1.43 at constant currency). The share count was nearly unchanged (1,285.1 million diluted vs 1,287.1 million), so buybacks did almost nothing for EPS this quarter.
Cash flow
Operating cash flow rose to $1.793 billion from $1.088 billion, and free cash flow (operating cash minus capital spending) more than doubled to $1.290 billion. Part of that is timing: cash paid for income taxes fell to $199 million from $402 million. Medtronic spent $1.162 billion on acquisitions (Scientia Vascular, closed June 12, and SPR Therapeutics, closed July 16), $921 million on dividends and $267 million on buybacks.
The Diabetes separation is under way
Medtronic's diabetes business (insulin pumps and glucose sensors) is now MiniMed Group (Nasdaq: MMED). MiniMed held its IPO on March 9, 2026, selling 28 million shares at $20 for $538 million of net proceeds. Medtronic kept about 90.03% of the shares, so it still consolidates MiniMed's results in its own accounts. In this quarter Diabetes contributed $843 million of revenue (8.6% of the total), up 14.9% organically. The 10-Q credits the U.S. launch of MiniMed Flex with the Simplera Sync sensor and international growth of the MiniMed 780G system.
On September 14, 2026, after the quarter ended, Medtronic started an exchange offer, a type of split-off in which Medtronic shareholders can swap their Medtronic shares for MiniMed shares. It covers up to 225,361,295 MiniMed shares, with the option to accept up to 2% more of Medtronic's outstanding shares if the offer is oversubscribed, to dispose of its whole remaining stake (per an 8-K filed September 17). The 10-Q says Medtronic plans to finish the separation within this fiscal year. Once it closes, Medtronic will lose one of its faster-growing revenue lines. Shareholders who tender will hand back Medtronic shares, so Medtronic's share count will also fall. The earnings release does not say how the separation is treated in the full-year guidance.
Takeaway: Strip out the extra week and Medtronic's organic growth was about 7%, not 13.7%, and nearly half of all reported revenue growth came from a single division: electrophysiology, led by pulsed field ablation. The adjusted operating margin barely moved (+0.1 point) despite an extra week of sales, so the company is not yet turning faster growth into higher margins.
Outlook
Management raised its fiscal 2027 guidance:
Organic revenue growth: 7.25% to 7.75%, up from 6.75% to 7.25%.
Non-GAAP diluted EPS: $5.94 to $6.00, up from $5.90 to $6.00. Only the bottom of the range moved; the midpoint rose 2 cents.
Currency is expected to be neutral to 1% accretive to EPS.
Our read: the revenue guidance is credible. Underlying Q1 growth of about 7% sits close to the new range, and the pulsed-field-ablation ramp (Sphere-360 won its CE Mark in January 2026, and Affera/Sphere-9 won an expanded CE Mark for ventricular arrhythmias in August) gives the Cardiovascular segment a clear growth driver. The EPS raise is smaller than the revenue raise, which fits this quarter's pattern: growth is being reinvested in selling costs and launches rather than lifting margins. Three things to watch over the next quarters:
Whether the adjusted operating margin rises once the extra-week distortion drops out of the comparisons.
Whether Medical Surgical's segment margin (21.3%, down from 23.4%) recovers.
How the MiniMed split-off changes Medtronic's reported revenue base and share count after it closes.
Reported growth rates in Q2-Q4 will look much lower than Q1's 13.7% simply because those quarters have no extra week.