Detailed narrative
TAVR: renewed category focus on evidence and durability
TAVR global sales of $1.2B grew 11%, with U.S. growth healthy and OUS even faster, including strong Japan adoption of SAPIEN 3 Ultra RESILIA. Growth was led primarily by market expansion tied to a heightened clinical focus on proactive management of severe aortic stenosis, reinforced by definitive 7-year PARTNER 3 and 10-year PARTNER II durability data and the practice-changing EARLY TAVR results for asymptomatic patients.
Global competitive position increased slightly YoY, mainly from a European competitor exit plus a slight U.S. share benefit, while average selling prices were stable globally. Management raised FY26 TAVR growth guidance to 7%-9% and framed a durable multiyear, mid-to-high-single-digit long-term opportunity.
TMTT: comprehensive repair-and-replacement portfolio scaling fast
TMTT sales rose ~42% YoY to $173M, one of the larger sequential dollar step-ups the franchise has posted, with mitral and tricuspid procedure volumes both growing double-digits globally. Growth is broad-based across the portfolio: EVOQUE is scaling on new 2-year TRISCEND II mortality data, PASCAL adoption is rising on differentiated design, and the newly FDA-approved SAPIEN M3 is drawing physician enthusiasm for mitral patients poorly suited to TEER or surgery.
Management reaffirmed the $740M-$780M FY26 range (35%-45% growth) and the path to $2B in TMTT revenue by 2030, positioning the portfolio as category creation rather than a share battle.
Surgical: RESILIA franchise driving steady mid-single-digit growth
Surgical sales of $276M grew 6%, driven by continued adoption of RESILIA tissue technologies — INSPIRIS, KONECT and MITRIS. KONECT (Bentall procedures) recently launched in Europe with strong adoption, and MITRIS is seeing strong uptake in surgical mitral valve replacement in additional markets.
Ten-year COMMENCE durability data will be presented at AATS, TRIFORMIS surgical tricuspid is expected to launch in H2, and a surgical left atrial appendage closure program is on track for preliminary introduction later this year. Management continues to expect mid-single-digit Surgical growth in 2026.
Guidance philosophy and the second-half comp dynamic
Total sales of $1.65B grew 12.7%, ahead of expectations, prompting raises to company sales (9%-11%, $6.5B-$6.9B), TAVR (7%-9%) and adjusted EPS ($2.95-$3.05). Management stressed a 'realistic' guidance philosophy and flagged two offsetting dynamics: Q1 2025 was a low-growth comp, while a strong 2025 H2 sets a higher bar for 2026 Q3 and Q4.
On the ~1-point TAVR raise despite the beat, management cited conservatism and that competitor long-term (Evolut) data dropped only in mid-to-late February, making its share contribution too early to parse.
Margins, capital allocation and expense discipline
Adjusted gross margin was 78.2% (down from 78.7%) on a weakening dollar and added manufacturing expense for new-therapy expansion, with FX cutting GM ~30bps; full-year 78%-79% guidance was maintained. R&D fell to 16% of sales (from 18%) on strategic prioritization and top-line leverage, guided to ~17% for the year, while SG&A was 31.7% of sales.
Adjusted operating margin reached 31.4%, and the company executed a $500M accelerated share repurchase (~$520M total in the quarter), leaving ~$1.5B remaining authorization against ~$2.4B of cash. Management is also searching for a new CFO, with Scott Ullem committed to a successful transition.
Regulatory landscape: CMS NCD reconsideration and RAPID
CMS is reconsidering the National Coverage Determination for TAVR; the initial 30-day public comment period closed January 14, with a draft decision memo expected by June 15. Management views its position as fact-based and centered on faster patient access but defers the outcome to CMS.
Separately, management highlighted a newly announced CMS/FDA breakthrough-therapy policy named RAPID, aimed at early and timely U.S. patient access, which it views as incrementally positive for its life-saving structural-heart technologies. Management characterized the overall healthcare/reimbursement environment as not intense given its life-saving, urgently-needed procedures.
Pipeline and clinical-evidence cadence
The TAVR pipeline includes SAPIEN X4, described as a potential game-changer for personalized valve sizing, now entering a confirmatory trial with evidence collection through 2026 before timelines are disclosed. PROGRESS (moderate AS) results are expected at TCT this year, alongside other Edwards trials, though management declined to preview results.
In TMTT, next-generation PASCAL for both mitral and tricuspid is expected in Q4 in the U.S. and Europe, and PASCAL for U.S. tricuspid patients is on track for a Q4 launch. Edwards will host its annual investor conference on December 4 at the NYSE.