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How Does Medtronic’s Restorative Therapies & Diabetes Group Look?

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Dec. 12 2018, Updated 12:16 p.m. ET

Restorative Therapies revenue trends

Medtronic’s Restorative Therapies Group consists of Spine, Brain, Specialty, and Pain therapies. Medtronic’s Restorative Therapies Group generated revenues of $2.0 billion in the second quarter of fiscal 2019 compared to $1.9 billion in the second quarter of fiscal 2018, reflecting ~7% YoY growth.

Restorative Therapies Group’s (or RTG) net revenues over the first half of fiscal 2019 amounted to $3.9 billion compared to $3.7 billion in the first half of fiscal 2018, reflecting 7% YoY growth.

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In the US market, the RTG segment generated net revenues of $2.7 billion in the first half of fiscal 2019, reflecting ~31% YoY growth. In the non-US developed (Western European countries, Japan, Korea, Canada, Australia, and New Zealand) and emerging markets, the RTG segment generated revenues of $840.0 million and $451.0 million, respectively, in the first half of fiscal 2019, reflecting ~7% and ~11% YoY growth.

Medtronic’s peers in the Restorative Therapies market Wright Medical Group (WMGI) and Integra Lifesciences Holding (IART) generated revenues of $194.1 million and $365.85 million, respectively, in the third quarter of this year, reflecting 13.84% and 31.2% YoY growth.

The revenue growth of Medtronic, Wright Medical Group, and Integra Lifesciences Holding could boost the iShares U.S. Medical Devices ETF (IHI). Medtronic, Wright Medical Group, and Integra Lifesciences Holding make up ~9.95%, ~0.68%, and ~0.70% of IHI’s total portfolio holding, respectively.

Diabetes Group revenue trends

Medtronic’s Diabetes Therapies Group generated revenues of $583.0 million in the second quarter of fiscal 2019, reflecting ~26% YoY growth. The Diabetes Therapies Group generated revenues of $1.16 billion in the first half of fiscal 2019 compared to $911.0 million in the first half of fiscal 2018, reflecting ~27% YoY growth.

The increased demand for the MiniMed 670G system primarily contributed to the revenue growth of Medtronic’s Diabetes Group revenues.

In the next article, we’ll discuss Medtronic’s restorative therapies segment in detail.

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