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    EW
    Earnings call· Sep 2025(Q3 FY25)

    Edwards Lifesciences Corp EW

    Oct 30, 2025 Source

    Executive summary

    Edwards Lifesciences Q3 FY25 — Double-Digit Sales Growth and Raised Full-Year Guidance

    Edwards Lifesciences delivered strong Q3 FY25 results, driven by robust performance across its structural heart portfolio, particularly TAVR and TMTT, leading to raised full-year sales and EPS guidance. The company highlighted significant clinical data presented at TCT, reinforcing the durability and efficacy of its therapies and setting the stage for continued long-term adoption and multiyear growth opportunities, despite some margin pressures from FX and investment timing.

    Highlights

    5

    • Total sales grew 12.6% to $1.55 billion, exceeding expectations.

    • TAVR global sales increased 10.6% to $1.15 billion, driven by renewed focus on timely intervention and new evidence.

    • TMTT sales increased 53% year-over-year to $144 million, fueled by strong performance of PASCAL and EVOQUE.

    • Full-year sales growth guidance raised to the high end of 9% to 10% range.

    • Full-year adjusted EPS guidance raised to between $2.56 and $2.62.

    Concerns

    3

    • Adjusted gross profit margin decreased to 77.9% from 80.7% in the prior year, primarily due to foreign exchange and operational expenses.

    • SG&A expense increased to $515 million or 33.1% of sales, due to deferral of certain first half spending and Q4 investments.

    • Q4 operating margin expected to be in the mid-20s, lower than first half, due to timing of key investments.

    Guidance & targets

    18
    CategoryTargetConfidence
    Full-year sales growth
    High end of 9% to 10% range
    high materiality
    High
    Full-year adjusted EPS
    $2.56 to $2.62
    high materiality
    High
    Full-year TAVR sales growth
    7% to 8%
    high materiality
    High
    Full-year TAVR sales
    $4.4 billion to $4.5 billion
    high materiality
    High
    Full-year TMTT sales
    $530 million to $550 million
    medium materiality
    High
    Full-year Surgical global sales growth
    Mid-single digits
    medium materiality
    High
    Full-year 2025 adjusted gross profit margin
    78% and 79%
    medium materiality
    High
    Full-year 2025 operating margin
    27% to 28%
    high materiality
    High
    Q4 operating margin
    Mid-20s
    medium materiality
    High
    2025 tax rate (excluding special items)
    15% to 18%
    low materiality
    High
    Full-year shares outstanding
    585 million to 590 million
    medium materiality
    High
    FX impact on full-year 2025 sales
    $30 million upside
    low materiality
    High
    Q4 total company sales
    $1.51 billion to $1.59 billion
    high materiality
    High
    Q4 adjusted EPS
    $0.58 to $0.64
    high materiality
    High
    Longer-term TAVR growth
    Mid- to high single-digit growth
    high materiality
    High
    TMTT market size
    $2 billion
    high materiality
    High
    Operating profit margin expansion
    Annual constant currency operating profit margin expansion over the full year 2025 level
    high materiality
    High
    Sales and profitability growth
    In line with our commitment from last year
    high materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    TAVR
    Global sales increased 10.6% over the prior year. Growth was comparable in the U.S. and OUS. Pricing and competitive position remained largely stable. Benefited from new evidence, guideline updates, expanded education, and less pronounced summer seasonality. Modest contribution from competitor exit in Europe.
    		$1.15 billion10.6%——
    TMTT
    Sales increased 53% year-over-year, fueled by strong performance of both PASCAL and EVOQUE. Globally, observed continued double-digit procedure growth for mitral and significantly higher growth for tricuspid. New ESC/EACTS guidelines support increased transcatheter therapies.
    		$144 million53%——
    Surgical
    Global sales increased 5.6% over the prior year. Growth driven by continued adoption of RESILIA therapy (INSPIRIS, KONECT, MITRIS) and positive procedure growth. KONECT market approval in Europe expanded access.
    		$258 million5.6%——

    Operational metrics

    19
    Adjusted EPS
    $0.67
    Q3 FY25

    Adjusted earnings per share for the third quarter.

    GAAP EPS
    $0.50
    Q3 FY25

    GAAP earnings per share for the third quarter.

    Adjusted gross profit margin
    77.9%down from 80.7% YoY
    Q3 FY25

    Adjusted gross profit margin for the third quarter, primarily impacted by foreign exchange and operational expenses.

    SG&A expense
    $515 millionup from $421 million YoY
    Q3 FY25

    Selling, general and administrative expense for the third quarter, increased due to deferral of certain first half spending and investments expected in Q4.

    R&D expense
    $281 millionup from $253 million YoY
    Q3 FY25

    R&D expense for the third quarter, reflecting intentional strategic prioritization of investments in the expanding structural heart portfolio.

    Adjusted operating profit margin
    27.5%
    Q3 FY25

    Adjusted operating profit margin for the third quarter, benefited from better-than-expected sales performance and deferral of certain spending to Q4.

    Reported tax rate
    16.1%
    Q3 FY25

    Reported tax rate for the third quarter.

    Tax rate (excluding special items)
    16.9%
    Q3 FY25

    Tax rate for the third quarter, excluding the impact of special items.

    Cash and cash equivalents
    $3 billion
    Q3 FY25

    Balance of cash and cash equivalents as of the end of the quarter.

    Share repurchase authorization remaining
    $2 billion
    Q3 FY25

    Amount remaining under the current share repurchase authorization after the Board increased it.

    Average diluted shares outstanding
    586 million
    Q3 FY25

    Average diluted shares outstanding during the third quarter.

    Year-to-date share repurchases
    $800 million
    YTD Q3 FY25

    Total share repurchases year-to-date, including a previously announced accelerated share repurchase.

    FX impact on reported sales growth
    210
    Q3 FY25

    Foreign exchange rates increased third quarter reported sales growth by 210 basis points or $24 million.

    FX impact on gross profit margin
    110negative impact
    Q3 FY25

    FX rates negatively impacted third quarter gross profit margin by 110 basis points.

    SAPIEN patients treated
    1.2 million
    Cumulative

    Total patients treated with the SAPIEN platform around the world.

    TRISCEND II patients benefited
    5,000
    Cumulative

    More than 5,000 patients have benefited from the TRISCEND II novel therapy.

    EVOQUE pacemaker rate
    15%
    30 days

    New pacemaker rate from TVT data on 30 days for EVOQUE.

    EVOQUE TR elimination
    19%
    30 days

    Consistent TR elimination from TVT data on 30 days for EVOQUE.

    EVOQUE major life-threatening bleeding rate
    1.3%
    30 days

    Very low major life-threatening bleeding rate from TVT data on 30 days for EVOQUE.

    Industry KPIs

    7
    MetricValueDetails
    Pricing realized pricestable
    New product launch rampearly introduction
    Procedure volume growthdouble-digit%
    FCF conversion leverage guidance$2.56 to $2.62USD
    Segment franchise organic growth10.6%%
    Indicated addressable patient population$2 billionUSD
    Pivotal trial clinical evidence milestones7-year data

    Deals & partnerships

    1
    JenaValveRegulatory approval for JenaValve acquisition

    Edwards continues to pursue regulatory approval for JenaValve despite an FTC block, citing large unmet patient needs. A ruling is expected in Q1.

    Risks & headwinds

    3
    Foreign Exchange ImpactQ3 FY25

    Negatively impacted Q3 gross profit margin by 110 bps.

    Mitigation: Company's program is designed to mitigate the foreign exchange impact on earnings per share.

    Investment Timing Impact on Operating MarginQ4 FY25

    Q4 operating margin expected in the mid-20s, lower than first half.

    Mitigation: Strategic prioritization of investments in expanding structural heart portfolio.

    Litigation ActivitiesQ3 FY25

    GAAP P&L reflects reserves for litigation activities.

    Mitigation: Periodic reserves are taken based upon exposure.

    What to watch in Q4 FY25

    5

    JenaValve Regulatory Ruling

    Q1 FY26
    CurrentPending FTC block
    TargetFavorable ruling

    Why it matters

    Determines ability to address large unmet patient needs in a specific TAVR segment.

    At the same time, we will know in Q1. So before Q1, I can tell you, Larry. But I really hope that we are going -- we will have a favorable ruling at the end because, again, these patients are waiting.

    Q&A highlights

    6

    What drove the 10.6% TAVR growth in Q3, considering the modest contribution from a competitor exit? Is the 7-8% full-year TAVR guidance sustainable longer term?

    Q3 strength was attributed to renewed focus on TAVR driven by new clinical evidence (PARTNER III, guidelines) and less pronounced summer seasonality, rather than a 'new normal.' The 7-year data provides reassurance for earlier treatment, and the company remains confident in the multiyear opportunity.

    “I will not take the Q3 results as the new normal for TAVR.”

    asked by Travis Steed · answered by Bernard Zovighian

    2 min read6 chapters

    Detailed Narrative

    01

    Strong Q3 Performance and Raised Outlook

    Edwards Lifesciences reported better-than-expected Q3 FY25 results with 12.6% sales growth to $1.55 billion, driven by its comprehensive structural heart portfolio. This strong performance led to an upward revision of full-year sales growth guidance to the high end of 9-10% and adjusted EPS guidance to $2.56-$2.62. The company expressed confidence in achieving sustainable top-line growth and profitability in 2026 and beyond, consistent with prior commitments.

    02

    TAVR Durability and Market Expansion

    Key data presented at TCT, including 7-year PARTNER III and 10-year PARTNER II studies, confirmed the long-term durability and performance of the SAPIEN platform, comparable to surgical aortic valve replacement (SAVR). This evidence, combined with updated ESC/EACTS guidelines and American Society of Echocardiography guidelines, is expected to drive continued long-term adoption of TAVR, particularly for severe AS patients regardless of symptoms, creating a multiyear growth opportunity.

    03

    TMTT Portfolio Advancements

    The TMTT segment saw 53% year-over-year sales growth, fueled by PASCAL and EVOQUE. New clinical evidence for EVOQUE, including hard endpoint benefits for severe TR patients and positive real-world data, strengthens confidence in tricuspid replacement therapy. The early European introduction of SAPIEN M3 for mitral replacement is progressing well, with U.S. approval anticipated by early 2026, further expanding treatment options for underserved mitral and tricuspid patients.

    04

    Surgical Segment Contribution

    The Surgical product group achieved 5.6% sales growth, driven by the continued adoption of the RESILIA therapy portfolio (INSPIRIS, KONECT, MITRIS) and positive procedure growth. The strong performance of Edwards' surgical valves in the PARTNER III 7-year data, comparable to TAVR, underscores the company's long-standing leadership and innovation in valve therapies.

    05

    Financial Performance and Capital Allocation

    Adjusted gross profit margin was 77.9%, with full-year guidance reaffirmed at 78-79%. R&D expense was 18.1% of sales, reflecting strategic prioritization of structural heart investments. The company maintains a strong balance sheet with $3 billion in cash and increased share repurchase authorization, with over $800 million executed year-to-date. CFO Scott Ullem announced his planned transition by mid-2026.

    06

    Pipeline and Future Growth Drivers

    Edwards is leveraging its structural heart expertise to extend into heart failure and aortic regurgitation, identifying these as next-generation contributors to patient impact and growth. The company's strategy focuses on breakthrough technologies and leadership across aortic, mitral, pulmonic, and tricuspid valve diseases, aiming for sustainable multiyear growth.

    AI-generated summary of the company’s earnings call. Not investment advice.