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Product / Company Performance

Stryker Posts 2Q18 Revenue Growth of 8% YoY -

ORTHOWORLD estimates Stryker’s 2Q18 orthopaedic revenue at US $1,747.8MM, +8.0% from 2Q17, and 1H18 revenue at $3,472.6MM, +7.5% vs. 1H17. Trauma and Extremities Joint Recon remain the highest performers, with Interventional and Tritanium products contributing to strong spine segment growth.

Estimated segment sales and growth follow.

  2Q18  2Q17  $ Change  % Change 
 Joint Reconstruction $933.2  $869.9  $63.3  7.3% 
   Knee  $527.6  $484.8  $42.9  8.8% 
   Hip  $375.1  $357.4  $17.6  4.9% 
   Extremities  $30.5  $27.7  $2.8  10.3% 
 Trauma $362.4  $328.2  $34.2  10.4% 
 Arthroscopy/Soft Tissue $128.7  $122.8  $5.9  4.8% 
 Spine $190.5  $172.3  $18.2  10.6% 
 Orthobiologics $57.4  $53.4  $4.1  7.6% 
 Other (CMF and Performance Solutions) $75.6  $72.2  $3.4  4.7% 
 Total  $1,747.8  $1,618.7  $129.1  8.0% 

 

  1H18  1H17  $ Change  % Change 
 Joint Reconstruction $1,856.3  $1,738.4  $118.0  6.8% 
  Knee  $1,051.1  $971.0  $32.2  4.5% 
  Hip  $743.1  $710.9  $5.7  10.1% 
  Extremities  $62.2  $56.4  $5.7  10.1% 
 Trauma $727.6  $655.9  $71.7  10.9% 
 Arthroscopy/Soft Tissue $256.9  $240.7  $16.2  6.7% 
 Spine $367.2  $345.7  $21.5  6.2% 
 Orthobiologics $113.9  $106.4  $7.5  7.1% 
 Other $150.6  $143.9  $6.7  4.7% 
 Total  $3,472.6  $3,230.9  $241.7  7.5% 

Geographic breakdown:

  2Q18  1H18 
 U.S. $1,180.26  $2,345.05 
 Ex-U.S. $567.50  $1,127.56 


Orthopaedic revenue ex-U.S. benefited from solid performances in Australia, Canada, Europe and emerging markets.

Mako Update

  • >550 robots installed globally
  • During 2Q: installed 39 robots (29 U.S.), up from 26 (20 U.S.) in 2Q17
  • On track to upgrade majority of robots by 3Q
  • >40% of robots sold in 2Q18 were in competitive accounts where SYK had no market share or share was well below company’s level
  • 160 surgeons trained on total knee (total since launch ~1,200)
  • Utilization +55% vs. 2Q17
     

Key growth drivers in 2Q18 included Mako, of course, as well as 3D-printed products and foot/ankle. Double-digit growth in spine was attributed to interventional products and Tritanium interbody implants; core spine product sales are challenged by market conditions and mid-single-digit price declines. More investment is underway to refresh the core spine portfolio.

Of note, power tools were called out as having an exceptional quarter, and this is only a few quarters into full commercial launch of the System 8 rollout.

Early in the quarter, the company announced its agreement to distribute ProChondrix®CR, a cryopreserved osteochondral allograft from AlloSource. After the quarter’s close, Stryker announced the 2019 retirement plans of David Floyd, Group President of Orthopaedics. Responsibility for all operating business and regions will now fall to Timothy Scannell, who assumes the title of President and Chief Operating Officer as of August 2018. A new commercial leadership structure brought the appointment of two new Group Presidents: J. Andrew Pierce overseeing MedSurg, and Spencer Stiles at the helm of Instruments, Neurotechnology and Spine.

Sources: Stryker Corp.; ORTHOWORLD estimates

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