VOL. 125 | NO. 164 | Tuesday, August 24, 2010
Medtronic Spinal Sales Dip 9 Percent
By Tom Wilemon
Sales of spinal products for Medtronic Inc. decreased 9 percent during the last three months.
The decline for the company’s spinal and biologics unit, which is based in Memphis, came as a surprise to Chief Executive Officer Bill Hawkins.
“The biggest surprise was the magnitude of the market slowdown in our two largest businesses, CDRM (cardiac rhythm disease management) and spinal, and how the slowdown escalated in June through July,” Hawkins said.
He spoke with market analysts in a conference call following the release of Medtronic’s first quarter earnings for the period ended July 30.
Medtronic earned $830 million – an 87 percent improvement from the $445 million in earnings from a year ago – despite having an overall decrease in revenue. The company was able to achieve the profit in part because of streamlining efforts over the past three years that have cut $600 million in product costs.
But still the news was not good. Medtronic lowered its guidance on earnings for the rest of the year.