Stryker Corporation (SYK) CEO Kevin Lobo on Q2 2022 Results - Earnings Call Transcript

Stryker Corporation (NYSE:SYK) Q2 2022 Earnings Conference Call July 26, 2022 4:30 PM ET

Company Participants

Kevin Lobo - Chair and Chief Executive Officer

Glenn Boehnlein - Chief Financial Officer

Jason Beach - Vice President, Investor Relations

Conference Call Participants

Robbie Marcus - JPMorgan

Lawrence Biegelsen - Wells Fargo

Vijay Kumar - Evercore

Pito Chickering - Deutsche Bank

Matthew O’Brien - Piper Sandler

Joanne Wuensch - Citi

Joshua Jennings - Cowen

Kyle Rose - Canaccord

Chris Pasquale - Nephron Research

Steve Lichtman - with Oppenheimer

Travis Steed - Bank of America

Drew Ranieri - Morgan Stanley

Michael Matson - Needham & Company

Jeff Johnson - Baird

Shagun Singh - RBC

Ryan Zimmerman - BTIG

Operator

Welcome to the Second Quarter 2022 Stryker Earnings Call. My name is Hannah and I will be your operator for today’s call. [Operator Instructions] This conference call is being recorded for replay purposes.

Before we begin, I would like to remind you that the discussions during this conference call will include forward-looking statements. Factors that could cause actual results to differ materially are discussed in the company’s most recent filings with the SEC. Also, the discussions will include certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures can be found in today’s press release that is an exhibit to Stryker’s current report on Form 8-K filed today with the SEC.

I will now turn the call over to Mr. Kevin Lobo, our Chair and Chief Executive Officer. You may proceed.

Kevin Lobo

Welcome to Stryker’s second quarter earnings call. Joining me today are Glenn Boehnlein, Stryker’s CFO; and Jason Beach, Vice President of Investor Relations. For today’s call, I will provide opening comments, followed by Jason with the trends we saw during the quarter and updates on Mako and Vocera. Glenn will then provide additional details regarding our quarterly results before opening the call to Q&A.

For the quarter, organic sales growth was 6% with high single-digit growth from our MedSurg and Neurotechnology businesses, led by endoscopy, instruments and neurocranial. Our hip and knee businesses delivered high single-digit growth in the face of tough compares from 2021. Internationally, we posted high single-digit organic growth with strength in Canada, Europe and Japan as well as double-digit organic growth in emerging markets despite the China COVID-related slowdowns.

During the quarter, we continue to have robust demand for our capital products. However, we had meaningful shipment delays as a result of ongoing product supply challenges mostly affecting our large capital businesses. As a reminder, less than 10% of our revenue is large capital, with about 15% of our revenue being smaller operating capital that drives revenue for hospitals.