Stryker (SYK) Misses Q3 Estimates as Hip and Knee Procedures Slow
Stryker's revenue rose 7.7% to $6.52 billion, short of the $6.58 billion expected, and it cut its 2026 growth forecast. The stock was down 7.6% Friday morning.
Stryker (SYK) reported third-quarter revenue of $6.52 billion, up 7.7% year on year, short of the $6.58 billion analysts expected, according to Zacks data cited by the Associated Press. Adjusted earnings of $3.52 a share also missed the $3.56 Zacks consensus. The shares were down 7.6% at $288.00 as of 9:31 a.m. ET on Friday, after the results came out following Thursday’s close.
The medical device maker had risen 2.6% on Thursday to close at $311.75 before the report. It also lowered its forecast for 2026 sales growth, which weighed on the stock along with the miss, Investing.com and Benzinga reported.
What stood out
Joint replacement was the weak spot. Organic sales in Orthopaedics, the unit that sells hip and knee implants, grew 5.9%, while MedSurg and Neurotechnology, which sells surgical equipment and neurotechnology products, grew 9.1%, the company said.
On the call, Chief Executive Kevin Lobo tied the slowdown to patients delaying surgery because of higher insurance premiums and deductibles, and to more pre-authorization denials, according to MarketBeat and MedTech Dive.
Lobo said in the release that the quarter “did fall short of our expectations.”
Profit held up better than sales. Adjusted earnings rose 10.3% from a year earlier, while GAAP earnings fell 11.7% to $1.96 a share.
The outlook
Stryker now expects organic sales growth of 6.5% to 7.0% for 2026, down from 8.3% to 9.3% before. It cut its adjusted earnings forecast to $14.80 to $14.90 a share, from $14.95 to $15.10.
The company said the cut reflects softer hip and knee procedure trends and lingering supply constraints in its peripheral vascular business. Management said it expects fourth-quarter organic growth to be similar to the third quarter’s if procedure trends hold.
Our take
Organic growth of 7.7% and a 10.3% rise in adjusted earnings are solid, but the guidance cut of about 2 percentage points at the midpoint says the year is going worse than Stryker planned. The fourth quarter will show whether the hip and knee slowdown is about patients’ insurance costs, as Lobo said, or something that lasts longer.
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Mostly Markets is for information and education only and isn't investment advice. Claire Okafor is a pen name. Prices are from Nasdaq and CNBC as of the time stated.
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