Exploring Merit Medical Systems’ Business Segments



Business segments

According to Merit Medical Systems (MMSI), the potential market size for its cardiovascular and endoscopy segments is $5.1 billion and $411 million, respectively.

Merit Medical Systems operates in two business segments—cardiovascular and endoscopy. The company’s cardiovascular segment consists of radiology medical devices for cardiac rhythm management, electrophysiology, interventional oncology, and spine devices. These products help diagnose and treat coronary artery disease and peripheral vascular diseases.

Devices sold under cardiovascular segment consist of stand-alone devices, custom kits and procedure trays, inflation devices, catheters, and embolization devices.

More than 50% of the revenues in the cardiovascular segment come from sales of stand-alone devices, custom kits and procedure trays, and catheters.

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Segment performance

In 3Q17, the cardiovascular segment generated revenues of $172.7 million—compared to $150.5 million in 3Q16. The cardiovascular segment is the company’s major revenue driver. The endoscopy segment’s revenues were relatively flat at $6.6 million in 3Q17—compared to $6.4 million in 3Q16.

Segment profitability

In 3Q17, Merit Medical Systems incurred an operating loss of $1.2 million from the cardiovascular segment—compared to an operating income of $1.8 million in 3Q16.

The operating income from the endoscopy segment increased from $1.1 million in 3Q16 to $2 million in 3Q17.

Revenue forecast

For fiscal 2017, Merit Medical Systems is expected to report revenues of $724.5 million. Abiomed (ABMD), Edwards Lifesciences (EW), and Teleflex (TFX) are expected to report revenues of $583.4 million, $3.8 billion, and $2.4 billion, respectively, in fiscal 2018.

Next, we’ll discuss Merit Medical Systems’ financial performance.


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