Europe & North America MedTech strengthens in 1H23

In a notable development, most MedTech companies in Europe and the US topped consensus estimates in 1H23 earnings, largely on a rewind in procedure volume and efficient execution of cost-saving strategy. Patient count surged in hospitals as people opted for non-urgent surgical treatment after delaying care during the pandemic, thereby accelerating demand for medical devices. This trend bodes well for MedTech giants Stryker, Zimmer Biomet, and Philips. Moreover, the decrease in supply chain constraints eased pressure on margins. Contrarily, extra retention charges of nursing staff pressured Fresenius Medical Care and Fresenius SE. Further, companies such as Philips, Stryker, and Baxter have lifted their 2023 guidance on improved surgery volumes. Conversely, on continuation of a softer environment for biopharma services, Danaher, and its peer ThermoFisher have narrowed their this year estimates.