NEW YORK, July 29, 2026 – Shares of Boston Scientific (NYSE:BSX) declined in early trading Wednesday, as the medical device maker's robust international performance helped offset a slowdown in its U.S. cardiac business. The stock fluctuated sharply in premarket activity, ultimately dropping 5.1% to $43.71 by 8:47 a.m. EDT, after having risen as much as 4.6% earlier.
The reversal followed a second reduction to the company's 2026 outlook since April. While second-quarter results exceeded analyst expectations, concerns surrounding the Watchman device weighed on the second-half outlook, prompting the market to reassess the stock.
The key metric for investors lies within two cardiac franchises: Watchman and electrophysiology. Combined, these two segments saw roughly 68% of their dollar growth come from international markets. However, that contribution represented only about 25% of their current-quarter sales, according to the company.
In the second quarter, combined Watchman and electrophysiology revenue reached $1.065 billion in the U.S. and $358 million internationally. Year-over-year increases were $32 million domestically and $66 million abroad, representing growth rates of 3.1% and 22.6%, respectively. This split indicates that international demand is mitigating, rather than resolving, the weakness in the U.S. market. Both franchises saw domestic growth hold close to 3%.
Quarterly Results Beat Expectations
Boston Scientific reported adjusted earnings per share of $0.86, surpassing the LSEG consensus of $0.83. Revenue rose 7.5% to $5.44 billion, also topping analysts' forecasts of $5.36 billion. Despite the beat, the company lowered its full-year guidance. Organic sales growth for 2026 is now expected between 5.0% and 6.0%, down from the previous range of 6.5% to 8.0%. Adjusted EPS guidance was revised to $3.28–$3.32, compared to the prior $3.34–$3.41 range and the LSEG consensus of $3.36.
The midpoint of organic growth guidance was cut by 1.75 percentage points, while the midpoint for adjusted EPS declined 2.2% relative to the April range.
Boston Scientific attributed the Watchman weakness to a decline in standalone procedures. Physicians are increasingly implanting the device alongside other heart treatments in a single session, which may affect standalone sales volumes.
CEO Comments and Profitability
Chairman and CEO Mike Mahoney described the results as a “solid quarter” despite a “dynamic environment.” He stated that Boston Scientific will focus on investments with the greatest impact going forward.
Profitability improved even as growth slowed. The adjusted operating margin rose to 28.4%, an increase of 70 basis points. Free cash flow for the second quarter came in at $1.29 billion, and the firm projects approximately $3.8 billion for the full year 2026.
Restructuring and Cost Savings
The company announced a restructuring program that provides an additional opportunity to impact earnings. Expected pretax charges are between $700 million and $800 million, with yearly gross savings estimated at approximately $500 million. When fully implemented, this represents 1.4 to 1.6 years’ worth of gross savings relative to the charge. A significant portion of the savings is earmarked for growth initiatives. The strategy calls for a reduction in workforce, with completion targeted by the end of 2029.
Risks and Outlook
Key risks include the possibility that U.S. Watchman and electrophysiology performance could remain subdued. Cost savings might be delayed, and reinvestments could restrict improvements in margins. The upcoming third quarter will be a test. The forecast projects sales growth of 3% to 5%, and adjusted EPS between $0.80 and $0.82. Continued strength from international demand remains important for the company’s near-term performance.
