Executive Summary
Medtronic generated USD 8.403 billion in revenue for QQ2 2024, representing a year-over-year decline of 2.17% but a sequential QoQ increase of 6.17%. The gross margin remained robust at 64.9%, supporting an operating margin of 19.0% and a net margin of 15.1%, with net income of USD 1.27 billion. EBITDA stood at USD 2.443 billion (EBITDAR 29.1%), underscoring solid cash generation from core operations despite a mid-to-high-teens percent leverage profile. The company’s cash flow from operations was USD 661 million for the quarter, with free cash flow of USD 200 million after USD 461 million of capital expenditures. Medtronic's balance sheet shows total assets of USD 90.1 billion and total liabilities of USD 38.4 billion, yielding a stockholders' equity base of USD 51.46 billion and a net debt position of USD 23.77 billion. The liquidity metrics illustrate a current ratio of 1.84 and a quick ratio of 1.39, but a relatively modest cash ratio of 0.11 indicates that debt management and working capital optimization remain critical going forward. Margins and cash flow are consistent with a large, diversified device portfolio, yet the elevated leverage and extended working capital cycle (inventory days ~167, DSO ~67, CCC ~162) may constrain flexibility amid ongoing macro and reimbursement headwinds. Absent an actionable earnings transcript in the provided data, the analysis relies on the disclosed figures to gauge operating performance and financial health while underscoring the need for management commentary on guidance and strategic priorities.
Key Performance Indicators
Key Insights
Revenue performance: USD 8.403 billion in Q2 2024, YoY -2.17%, QoQ +6.17%; Gross Profit USD 5.457 billion, Gross Margin 64.9% (YoY margin decline -1.59%, QoQ +15.81% in gross profit). Operating Income USD 1.595 billion, Operating Margin 19.0% (YoY +51.47%, QoQ +24.80%). Net Income USD 1.27 billion, Net Margin 15.1% (YoY +94.19%, QoQ +21.88%). EBITDA USD 2.443 billion, EBITDA Margin ~29.1%. R&D USD 697 million; SG&A USD 2.757 billion; Interest Expense USD 209 million; Depreciation & A...
Financial Highlights
Revenue performance: USD 8.403 billion in Q2 2024, YoY -2.17%, QoQ +6.17%; Gross Profit USD 5.457 billion, Gross Margin 64.9% (YoY margin decline -1.59%, QoQ +15.81% in gross profit). Operating Income USD 1.595 billion, Operating Margin 19.0% (YoY +51.47%, QoQ +24.80%). Net Income USD 1.27 billion, Net Margin 15.1% (YoY +94.19%, QoQ +21.88%). EBITDA USD 2.443 billion, EBITDA Margin ~29.1%. R&D USD 697 million; SG&A USD 2.757 billion; Interest Expense USD 209 million; Depreciation & Amortization USD 675 million. Cash Flow: Net cash provided by operating activities USD 661 million; CAPEX USD 461 million; Free Cash Flow USD 200 million. Balance Sheet: Total Assets USD 90.1 billion; Total Liabilities USD 38.44 billion; Total Stockholders’ Equity USD 51.46 billion; Net Debt USD 23.77 billion (Long-term Debt USD 23.741 billion; Cash & Short-Term Investments USD 7.734 billion). Liquidity/Working Capital: Current Ratio 1.84; Quick Ratio 1.39; Cash Ratio 0.114; DSO 67.05 days; DIO 167.38 days; DPO 72.59 days; Cash Conversion Cycle 161.84 days. Leverage: Debt to Capitalization 36.9%; Long-Term Debt to Capitalization 33.6%; Interest Coverage 7.63x. Dividend/Shareholder Return: Payout Ratio 70.6%. Valuation signals: Enterprise Value Multiple ~11.02x; Price-to-Book/Price-to-Sales data not fully provided in the dataset.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
8.40B |
-2.17% |
6.17% |
| Gross Profit |
5.46B |
-1.59% |
15.81% |
| Operating Income |
1.60B |
51.47% |
24.80% |
| Net Income |
1.27B |
94.19% |
21.88% |
Key Financial Ratios
operatingProfitMargin
19%
dividendPayoutRatio
70.6%
Management Commentary
Note: The dataset does not include an earnings transcript. As a result, there are no management quotes or thematic quotes to extract. If a transcript becomes available, a themes-based synthesis (strategy, operations, market conditions) with direct quotes can be added here.
Forward Guidance
No explicit numerical guidance for QQ3 2024 or beyond is provided in the supplied data. In absence of management guidance, the assessment relies on industry dynamics and the quarterly cadence. Key factors to monitor include: (1) trajectory of revenue growth in core portfolios (Cardiovascular, Medical-Surgical, Neuroscience, Diabetes) and progression of high-margin product lines such as remote monitoring, AI-enabled software, and robotic-assisted surgery; (2) sustainability of gross margins amidst product mix shifts and pricing/reimbursement pressures; (3) working capital normalization given the extended CCC and inventory cycle; (4) debt trajectory and deleveraging potential, given net debt of USD 23.77 billion and EBITDA of USD 2.44 billion; (5) potential share repurchases or dividend policy adjustments given payout ratio around 70.6% and capital allocation priorities; and (6) macro currency effects and global demand dynamics in healthcare equipment.