
Edwards Lifesciences Reports In-Line 3Q23 But Guides Below Street for 4Q23 Following Strong Data Showing at TCT
Edwards Lifesciences recently released its financial results for the third quarter of 2023. The company experienced an in-line performance reporting a 12% growth in sales, totaling $1.48 billion. This was consistent with consensus forecasts. The company also saw significant therapy approvals, and milestone achievements in clinical research this quarter including recent positive data on their percutaneous heart valve for TAVR at TCT.
The company’s Transcatheter Aortic Valve Replacement (TAVR) segment contributed significantly to this success. TAVR sales for the quarter amounted to $961 million, representing an 11% year-over-year increase. Management noted stable market share and pricing in the quarter.
The Transcatheter Mitral and Tricuspid Therapies (TMTT) segment also showed growth. Sales for Q3 reached $52 million, driven by the accelerated adoption of the PASCAL Precision system, overall growth in transcatheter edge-to-edge repair procedures, and the activation of additional centers across Europe and the United States. The company expects to launch the technology in Japan by year end.
The Surgical Structural Heart segment achieved strong sales growth of $247 million for the quarter, marking a 12% increase or 11% on a constant currency basis. This growth was driven by a combination of the successful adoption of Edwards’ premium RESILIA products and the overall expansion in procedure volumes.
Critical Care sales reached $221 million for the quarter, with a 7%. This growth was attributed to the Smart Recovery technology portfolio and the strong adoption of the Acumen IQ sensor equipped with the Hypotension Prediction Index algorithm.
Larry Wood, Group President of TAVR and Surgical Structural Heart at Edwards Lifesciences, expressed that, after over two decades of rigorous clinical experience and over one million patients treated, TAVR with SAPIEN has become an effective standard of care for individuals suffering from aortic heart valve failure. The company noted that it expects the TAVR market to reach $10 billion globally by 2028 representing strong growth. Data from both Edwards Lifesciences and Medtronic at TCT highlighted the advantages of TAVR over surgical interventions.
In the quarter, the company achieved key milestones. It received the CE Mark for the EVOQUE tricuspid valve replacement system, Japanese and approved the PASCAL Precision system for treating individuals with degenerative mitral regurgitation. The EVOQUE system is the world’s first transcatheter valve replacement therapy to receive regulatory approval to treat tricuspid regurgitation. Additionally, the enrollment of the ENCIRCLE pivotal trial, studying patients treated with Edwards’ innovative SAPIEN M3 transfemoral mitral valve replacement therapy, was successfully completed.
The company reported free cash flow of $356 million for the quarter, defined as cash flow from operating activities of $411 million, minus capital spending of $55 million. Edwards Lifesciences’ cash, cash equivalents, and short-term investments reached $1.9 billion as of September 30, 2023, while total debt was approximately $600 million. Adjusted EPS for the quarter were $0.59, in-line with consensus forecasts.
Edwards Lifesciences reiterated its full-year 2023 financial guidance, expecting constant currency sales growth in the range of 10% to 13%. This guidance remains consistent for both the total company and each product group. For the full year 2023, the company expects adjusted earnings per share to fall within the range of $2.50 to $2.60. In Q4 2023, Edwards Lifesciences anticipates total sales between $1.45 billion and $1.53 billion, with diluted earnings per share projected to be between $0.60 and $0.66. The street was forecasting total 4Q revenue of $1.54 billion and earnings per share of $0.68.