Patrick Wood

Dan explained the legacy Minnesota (Cantel) and St. Louis chemistry plants are not expandable and near capacity limits, forcing a greenfield build; North Carolina was chosen for distribution efficiencies and STEM talent access, with significant automation.

Karen confirmed gross margin was up on price and productivity absent tariffs, with the $4 million refund helping offset $14 million of true tariff costs that she said are not going anywhere.

Dan said ASC shift is a positive due to new capacity demand and higher clinical support needs that STERIS is uniquely positioned to provide. No material PPE manufacturing commitments or API relocation impact seen yet.

Dan confirmed commitment to EMEA expansion with structural go-to-market changes underway. Acknowledged it will take time to fully formulate and execute but expressed confidence in direction.

Dan explained Healthcare services includes IMS repair and instrument processing. Price gains tied to labor cost pass-throughs will moderate as labor normalizes, slowing top line but preserving margins.

Dan declined to break out X-ray specifically, framing all radiation modalities as interchangeable tools. Said X-ray drives much of expansion capacity but would not quantify.

Dan candidly acknowledged onshoring is more aspirational than real so far, but noted opportunities for volume shifts within existing regulated manufacturing footprints.

Dan indicated some industry consolidation is likely but STERIS would prefer building new capacity over acquiring aging facilities.

Dan said the EO rules are already in place and unlikely to be retracted despite EPA changes. STERIS is well-positioned to comply within deadlines.

Dan noted strong reprocessing performance with good chemistry pull-through, but endoscopy products are growing at market, not above it.

Dan declined to comment on EO litigation strategy, referring analysts to the 10-Q disclosures and declining to discuss ongoing litigation.

Dan noted no direct tariff concerns from customers but highlighted reshoring trends in AST with significant growth in Malaysia facilities.

Polen credited both: a new CRO, changed sales comp, and a $35M targeted investment that grew APM/UCC/PI sales teams ~15%. Specific and thorough.

Tom confirmed no structural change. 90% of portfolio growing solid mid-single digits. 10% (Alaris, vaccines, China) has known transitory headwinds. Highlighted $30M incremental sales investments all 100% on track, double-digit growth in PureWick, biologics, tissue reconstruction.

Chris highlighted discipline around net leverage (2.8x→2.5x target). Waters transaction creates over 200bps EPS growth uplift. Current Waters share price implies ~$50 per BD share, leaving remaining New BD trading at ~10x multiple.

Tom confirmed 4% New BD organic as the expected full-year run rate. Highlighted continued momentum across Interventional, Connected Care, APM (13% growth), Pharm Systems recovery, and sequential improvement in Life Sciences.

Tom described Kaizens as highly energizing for employees, not draining. Mike Feld added that lean processes actually free up time for creativity and strategy.

Tom highlighted Interventional as a priority for capital allocation with multiple high-growth opportunities, alongside continued organic R&D acceleration.

Tom emphasized strong local manufacturing strategy with minimal China exposure, only one product exported from China to the U.S.

Direct and upbeat: record quarter, smooth integration, rising orders, though small relative to Medical.

Credited better outcomes and Stryker's shoulder innovation, including Mako shoulder, for faster market growth.

Quantified the ASC mix shift and named ASC construction as the limiting factor, calling the trend steady rather than inflecting.

Detailed answer on the new business unit, tech stack modernization and an expected strong second half in SmartCare.

Kevin Lobo confirmed vascular/PV is now part of the acquisition set. Also eyeing more health IT acquisitions following Vocera and Care AI. Every acquisition opens new adjacency windows.

Kevin Lobo said high market share means ASC shift is just a new site of care. New ASC construction benefits Stryker's full portfolio offering. Sports business is a big beneficiary. CMS push to ASC only helps given breadth of portfolio.

Kevin detailed 1788 camera success, sports med double-digit growth with AlphaVent Knotless, new Oculan light, and communications orders. Mako Shoulder getting very positive feedback but meaningful contribution starts 2026.

CEO confirmed program was always contemplated but timing driven by separation progress and bandwidth availability; tariffs increased urgency. Savings reinvested in R&D and commercial infrastructure.

CEO was clear that 4-5% LRP organic target is achievable without M&A; M&A would accelerate or overachieve that target, not fill a gap.

CFO confirmed pricing in normalized ±1% range; company is focused entirely on volume growth as the sustainable strategy.

CFO expressed confidence in 2.5% normalized figure based on post-quarter analytics and distributor partnership data; acknowledged variability but called it a strong quarter.

CEO confirmed M&A capacity being built; targeting early 2026 timeframe for first deals after debt paydown; smaller tuck-in transactions.

CFO confirmed small 10-20bps margin benefit from SKU rationalization; primary driver is supply chain simplification, not margin expansion.

Listed five product claims and three target surgeon segments, but gave no rollout pace because the system is not yet approved.

Ivan detailed S.E.T. drivers: Paragon 28 near 15%, upper extremities upper single digit, CMFT in the teens on thoracic; flagged trauma and restorative therapies as the two headwinds and expects a better S.E.T. profile in H2.

Sukhi attributed pricing step-down to: EMEA price increase moderation, Japan biannual price decrease, China go-to-market reconfiguration, and Americas roughly in line with 2025. FY2025 ended at flat consolidated pricing with Q4 at -50bps. Consistent with Analyst Day framework.

Ivan said all senior P&L owners now paid on revenue growth, EPS, and FCF. Sales reps accountable for pricing dynamics. Compensation tied to growth and controllable margin at every level. Acknowledged incentive discipline was 'choppy over the last 3 or 5 years' but now fully implemented.

Ivan confirmed Z1 is driving market share gains with ~50% competitive conversions. Zero supply shortages as of Q2 after late 2024 challenges. Growth amplified by OrthoGrid (acquisition exceeding expectations) and HAMMR. Two consecutive quarters of 5% U.S. Hip growth; expects similar or better run rate through year-end.

Ivan committed to preserving Paragon's dedicated channel, keeping the management team including CEO Albert Acosta, and running integration in isolation to minimize disruption.

CEO cited combining PI and ICTx reporting structure. Penumbra adds PE and neurovascular with scaled sales force. ICT area receiving some of company's biggest investments. Did not directly address competitor vascular force buildout.

CEO cited Nalu reaching solid Medicare reimbursement, improving commercial payer coverage, and proven sales track record. Neuromod team proven with Relievant integration. Nalu creates widest pain portfolio versus SCS-only competitors.

CEO expects Empower approval H2 2025 with larger 2026 impact. Denali S-ICD portfolio refresh launching 2026. Dr. Stein emphasized modular S-ICD communication as key differentiation.

CEO described ESG as long-term endo growth driver with dedicated team, clinical trials, and CPT code momentum, but not reshaping BSX in 2025. Unique positioning with Apollo wrapped in broader endo portfolio.