How Did Boston Scientific Fare In Q2’16 Earnings?

-5.28%
Downside
67.24
Market
63.69
Trefis
BSX: Boston Scientific logo
BSX
Boston Scientific

Boston Scientific (NYSE:BSX) achieved a strong revenue growth of 15% in Q2’16, the results of which were reported by the company on July 28th. However, the outstanding revenue growth couldn’t percolate down to the net income line, due to a decline in the gross margins, higher SG&A expenses and an increase in the litigation related charges incurred by the company in Q2. Boston Scientific’s gross margins declined to 70.7% on a year over year basis, due to increase in its expenses related to its new manufacturing plant in Malaysia, the AMS integration charges and inventory write-offs related to new product launches.

Nevertheless, we can expect the margins to improve going ahead, due to lower inventory charges and a decline in the SG&A expenses that increased in Q2 due to increased trade show activities. Further, the company estimates that its current mesh related reserves closely reflect the litigation charges that it might have to incur to settle the dispute going forward. Hence, we can expect the litigation related charges to subside in the coming quarters. With two successive quarters of strong performance, the company has raised its full year revenue guidance for organic revenue growth by approximately 100 basis points.

In the table below, we look at the key metrics as reported by Boston Scientific in Q2 2016 earnings release:

Relevant Articles
  1. Should You Pick Boston Scientific Stock After A Solid Q4 And 13% Uptick This Year?
  2. What’s Next For Boston Scientific Stock After 5% Gains In A Week?
  3. Should You Pick MGM Resorts Over Boston Scientific Stock For Better Returns?
  4. Which Is A Better Buy – Boston Scientific Stock Or Abbott?
  5. What’s Next For Boston Scientific Stock After Outperforming During The 2022 Inflation Shock?
  6. New Product Launches To Aid Boston Scientific’s Q1

BSX_Earnings_Q2'16

See More at Trefis | View Interactive Institutional Research (Powered by Trefis)

Get Trefis Technology