Stryker Reports 8.5% EPS Decline, Maintains 8–9.5% Sales Growth Guidance
Stryker reported 2.4% organic sales growth in Q1 with adjusted EPS of $2.60, down 8.5%, and margins contracting by 190 basis points following a cyber incident. The company preserved 2026 guidance of 8–9.5% organic sales growth and $14.90–$15.10 EPS while closing an Amplitude Vascular acquisition.
1. Q1 Financial Performance
Stryker delivered 2.4% worldwide organic sales growth, with 1.9% in the US and 3.9% internationally. Adjusted EPS came in at $2.60, down 8.5% year-over-year, while adjusted gross margin fell to 63.6% and operating margin to 21.1%, each down roughly 190 and 180 basis points respectively; the effective tax rate was 14.5% and cash from operations reached $581 million year-to-date.
2. Cyber Incident Impact and Recovery Outlook
A cyber attack disrupted manufacturing absorption and delayed revenue recognition, pressuring margins and sales timing. Management expects partial recovery in Q2 across segments, with full catch-up in the second half as deferred procedures resume and production delays clear.
3. Strategic Expansion and Innovation
The quarter saw record Mako robotic system installations with strong utilization rates globally. Stryker completed the Amplitude Vascular Systems acquisition to bolster its cardiovascular portfolio and launched its Ortho Tech business to streamline the customer experience and accelerate orthopedic innovation.
4. Full-Year Guidance and Outlook
Despite first-quarter challenges, full-year 2026 guidance remains intact with 8–9.5% organic net sales growth and $14.90–$15.10 adjusted EPS. International fundamentals are solid, and management believes modest geopolitics won’t derail the growth trajectory.