AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 18/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Regulatory execution and proprietary products are demonstrated, but persistent superiority or exclusion of competitors is not established.
durability · — · The passages do not establish the duration of economically meaningful exclusivity or comparative advantages. Patent expiry and technological substitution remain relevant exposures.
customer dependency · — · Continued adoption and minimum purchase commitments indicate demand, but do not establish material customer dependence or switching friction.
erosion resilience · — · Growth supports current commercial health, but the evidence does not demonstrate sustained protection against competing technologies, procurement pressure or clinical displacement.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · — · Customer price sensitivity and tender mechanisms are disclosed, but actual selling-price movements are absent. Revenue growth and margins cannot establish realized pricing.
retention · 2/4 · Continued system adoption, organic growth and noncancellable minimum purchase commitments support repeat demand indirectly. The approximately $0.4 billion of longer-duration obligations covers only a limited portion of annual revenue; customer retention rates and switching friction are undisclosed.
margin resilience · 2/4 · The July 2026 quarter shows a broadly stable cost-of-products-sold ratio and improved consolidated operating margin. Segment evidence is mixed: Medical Surgical operating profit was essentially flat despite sales growth. This supports resilience with limitations, without attributing it to pricing.
contractual freedom · 1/4 · Price regulation, bidding, tenders and reimbursement limits materially constrain pricing discretion. Minimum purchase commitments support committed demand but disclose no unilateral repricing rights.
Predictability94
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 75.00
- Revenue growth volatility (pp)
- 3.49
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 1.51
Financial strength58
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 40.67
- netDebtEbitGrade
- 19.55
- interestCoverageGrade
- 73.13
- currentRatioGrade
- 100.00
- Debt / FCF (x)
- 5.15
- Net debt / operating income (x)
- 4.02
- Interest coverage (x)
- 9.04
- Current ratio (x)
- 2.13
Capital allocation83
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 7.84
- 3-year average dilution (%)
- -1.21
- 3-year average SBC / revenue (%)
- 1.25
- cashConversionGrade
- 100.00
Management56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Fiscal 2026 operating cash flow of $7.33 billion funded $1.904 billion of capital expenditure, demonstrating cash generation after reinvestment. Dividends and repurchases coexist with increased acquisition spending, short-term borrowing and a realized investment write-down. Acquisition returns are not established, so capital discipline is mixed.
incentive alignment · 3/4 · Actual three-year PSU payouts, compensation reduced by underwater options, maintained performance targets and disclosed clawback and ownership safeguards demonstrate meaningful alignment. This is not exceptional: bonuses exceeded target despite an EPS miss, and the fiscal 2027 design removes the ROIC modifier. Beneficial ownership amounts are unavailable.
execution · 2/4 · Organic revenue growth, regulatory clearance, continued product adoption and cash generation demonstrate execution through indirect operating evidence. The missed EPS target and investment loss temper that record; completing the MiniMed IPO does not demonstrate completion or benefits of the separation.
governance · 2/4 · The disclosed board is independent apart from the CEO, key committees are independent, and Audit Committee oversight is documented. The combined chairman/CEO role and CEO leadership of the Growth and Operations Committees limit the strength of independent oversight. These are existing arrangements, not assumed approval of meeting proposals.
Evidence
The Hugo RAS system received U.S. FDA clearance for use in urologic surgical procedures in December 2025.
MD&A / Medical Surgical / Hugo regulatory clearance · Filed 03/09/2026
due to the commercial launch of MiniMed Flex with Simplera Sync and continued international growth due to the continued adoption of the MiniMed 780G AID system, including the Simplera Sync and Instinct sensors.
MD&A / Diabetes / launch and continued adoption · Filed 03/09/2026
As a part of the regulatory process of obtaining marketing clearance for new products and new indications for existing products, we conduct and participate in numerous clinical trials with a variety of study designs, patient populations, and trial endpoints.
Risk factors / clinical trials for marketing clearance · Filed 18/06/2026
The Company generated $36.4 billion in revenue, up 8.4% reported and up 5.8% organically versus the fiscal year ended April 25, 2025 (fiscal year 2025 or FY25), marking our strongest top-line performance in 10 years.
Proxy / fiscal 2026 performance highlights / reported and organic revenue growth · Filed 17/08/2026
Further, pending patent applications may not result in patents being issued to us, patents issued to or licensed by us may be challenged or circumvented by competitors and such patents may be found invalid, unenforceable or too limited in scope to protect our technology or provide us with any competitive advantage.
Risk factors / patent challenges and circumvention · Filed 18/06/2026
In addition, our patents will expire over time, our ability to protect novel business models is uncertain, and infringement may go undetected.
Risk factors / patent expiry · Filed 18/06/2026
New or alternative technologies, therapies, or treatment modalities may disrupt existing procedures or reduce demand for device‑based therapies, including in markets where we currently have leading positions.
Risk factors / alternative therapies and disruption · Filed 18/06/2026
Major shifts in industry market share have occurred in connection with product corrective actions, physician advisories, safety alerts, results of clinical trials to support superiority claims, and publications about our products, reflecting the importance of product quality, product efficacy and quality systems in the medical device industry.
Business / competition / historical industry market-share shifts · Filed 20/06/2025
This has created an increased level of price sensitivity among customers for our products.
Business / customer price sensitivity · Filed 18/06/2026
Government and private sector initiatives to limit the growth of healthcare costs, including price regulation, competitive pricing, bidding and tender mechanics, coverage and payment policies, comparative effectiveness of therapies, technology assessments and managed-care arrangements, are continuing in many countries where we do business, including the U.S.
Business / healthcare cost controls, price regulation and tenders · Filed 20/06/2025
Government programs, including Medicare and Medicaid, private healthcare insurance, managed-care plans, and volume-based procurement tenders in China, have attempted to control costs by limiting the amount of reimbursement they will pay for particular procedures or treatments, tying reimbursement to outcomes, shifting to population health management, and other mechanisms.
Business / reimbursement limits and volume-based procurement · Filed 20/06/2025
Remaining performance obligations include goods and services that have not yet been delivered or provided under existing, noncancellable, contracts with minimum purchase commitments.
Revenue recognition / noncancellable minimum purchase commitments · Filed 03/09/2026
At July 31, 2026, the estimated revenue expected to be recognized in future periods related to unsatisfied performance obligations for executed contracts with an original duration of one year or more was approximately $0.4 billion.
Revenue recognition / remaining performance obligations · Filed 03/09/2026
Financial Statements Medtronic plc Condensed Consolidated Statements of Income (Unaudited) Three months ended (in millions, except per share data) July 31, 2026 July 25, 2025 Net sales $ 9,756 $ 8,578 Costs and expenses: Cost of products sold, excluding amortization of intangible assets 3,416 3,001 Research and development expense 771 726 Selling, general, and administrative expense 3,198 2,806 Amortization of intangible assets 412 459 Restructuring charges, net 72 45 Certain litigation charges, net — 27 Other operating expense (income), net 123 70 Operating profit 1,764 1,445 Other non-operating expense (income), net (190) (33) Interest expense, net 186 176 Income before income taxes 1,769 1,302 Income tax provision 289 255 Net income 1,479 1,047 Net income attributable to noncontrolling interests (9) (7) Net income attributable to Medtronic $ 1,470 $ 1,040 Basic earnings per share $ 1.15 $ 0.81 Diluted earnings per share $ 1.14 $ 0.81 Basic weighted average shares outstanding 1,279.8 1,281.6 Diluted weighted average shares outstanding 1,285.1 1,287.1 The accompanying notes are an integral part of these condensed consolidated financial statements.
Condensed consolidated statements of income / July 2026 and July 2025 quarters · Filed 03/09/2026
The following tables present reconciliations of financial information from the segments to the applicable line items in the Company's condensed consolidated financial statements: Segment Operating Profit Three months ended July 31, 2026 (in millions) Cardiovascular Neuroscience Medical Surgical Total Net sales $ 3,927 $ 2,678 $ 2,279 $ 8,884 Reconciliation of revenues Other operating segments net sales(1) 872 Total consolidated net sales $ 9,756 Less: Cost of products sold, excluding amortization of intangible assets 1,308 786 919 3,013 Research and development expense 303 163 189 656 Selling, general, and administrative expense 1,269 922 681 2,872 Other segment items(2) 14 13 5 32 Reportable segment operating profit $ 1,033 $ 793 $ 485 $ 2,311 Reconciliation of segment profit / (loss) Other operating segments profit(1) 74 Currency and other (69) Interest expense, net (186) Other non-operating expense (income), net 190 Amortization of intangible assets (412) Restructuring and associated costs (89) Acquisition and divestiture-related items (50) Income before income taxes $ 1,769 31 Medtronic plc Notes to Condensed Consolidated Financial Statements (Unaudited) Three months ended July 25, 2025 (in millions) Cardiovascular Neuroscience Medical Surgical Total Net sales $ 3,285 $ 2,427 $ 2,073 $ 7,785 Reconciliation of revenues Other operating segments net sales(1) 755 Other adjustments(3) 39 Total consolidated net sales $ 8,578 Less: Cost of products sold, excluding amortization of intangible assets 1,132 724 812 2,668 Research and development expense 280 157 169 606 Selling, general, and administrative expense 1,060 831 605 2,497 Other segment items(2) (15) 2 1 (12) Reportable segment operating profit $ 828 $ 713 $ 486 $ 2,027 Reconciliation of segment profit / (loss) Other operating segments profit(1) 37 Currency and other (47) Interest expense, net (176) Other non-operating expense (income), net 33 Amortization of intangible assets (459) Restructuring and associated costs (67) Acquisition and divestiture-related items (58) Certain litigation charges, net (27) Other adjustments(3) 39 Income before income taxes $ 1,302 (1)Includes the operations and ongoing transition agreements from businesses the Company has exited, divested, or intends to separate, including the Diabetes Business.
Segment information / sales and operating profit reconciliations · Filed 03/09/2026
MEDTRONIC I 2026 Proxy Statement A-3 MEDTRONIC PLC GAAP TO NON-GAAP RECONCILIATIONS(1) (Unaudited) (in millions) Fiscal Year 2026 Net cash provided by operating activities $ 7,330 Additions to property, plant, and equipment (1,904) Free Cash Flow(2) $ 5,426 Adjustments as contemplated under Annual Incentive Plan(3) (391) Free Cash Flow for Incentives $ 5,036 (1)The data in this schedule has been intentionally rounded to the nearest million, and, therefore, may not sum.
Appendix A / fiscal 2026 operating cash flow, capital expenditure and free cash flow · Filed 17/08/2026
3 Medtronic plc Condensed Consolidated Statements of Equity (Unaudited) Ordinary Shares Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Shareholders’ Equity Noncontrolling Interests Total Equity (in millions) Number Par Value April 24, 2026 1,280 $ — $ 20,926 $ 32,638 $ (4,101) $ 49,463 $ 609 $ 50,072 Net income — — — 1,470 — 1,470 9 1,479 Other comprehensive income (loss) — — — — 342 342 — 342 Dividends to shareholders ($0.72 per ordinary share) — — — (921) — (921) — (921) Issuance of shares under stock purchase and award plans, net of shares withheld for taxes 3 — (21) — — (21) — (21) Repurchase of ordinary shares (3) — (226) — — (226) — (226) Stock-based compensation — — 125 — — 125 — 125 July 31, 2026 1,280 $ — $ 20,805 $ 33,187 $ (3,759) $ 50,232 $ 618 $ 50,850 Ordinary Shares Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Shareholders’ Equity Noncontrolling Interests Total Equity (in millions) Number Par Value April 25, 2025 1,282 $ — $ 20,833 $ 31,476 $ (4,284) $ 48,024 $ 232 $ 48,256 Net income — — — 1,040 — 1,040 7 1,047 Other comprehensive income (loss) — — — — (319) (319) 1 (318) Dividends to shareholders ($0.71 per ordinary share) — — — (910) — (910) — (910) Issuance of shares under stock purchase and award plans, net of shares withheld for taxes 1 — 93 — — 93 — 93 Repurchase of ordinary shares (1) — (120) — — (120) — (120) Stock-based compensation — — 86 — — 86 — 86 July 25, 2025 1,282 $ — $ 20,891 $ 31,606 $ (4,604) $ 47,893 $ 240 $ 48,133 The accompanying notes are an integral part of these condensed consolidated financial statements.
Statements of equity / dividends, repurchases and stock compensation · Filed 03/09/2026
The increase was primarily driven by an increase in acquisitions of $1.2 billion, partially offset by net sales of investments of $109 million.
MD&A / investing activities / increased acquisition spending · Filed 03/09/2026
During the fourth quarter of fiscal year 2026, the Company recognized a loss of the remaining $50 million investment, reducing the fair value of the investment to zero as of April 24, 2026.
Investment valuation / remaining investment written down to zero · Filed 03/09/2026
The Board ultimately determined to maintain the original performance targets.
Proxy / incentive decisions / original performance targets maintained · Filed 17/08/2026
While the EPS goal was not achieved, strong performance in revenue growth and free cash flow resulted in MIP payouts at 103% of target for FY26, reflecting the Company’s emphasis on balanced financial performance and continued operational execution.
Proxy / fiscal 2026 EPS shortfall and annual incentive payout · Filed 17/08/2026
PSU PAYMENTS Name FY24-FY26 Actual Performance FY24-FY26 Target Shares FY24-FY26 Shares Paid Geoff Martha 101.5% 85,461 86,743 Thierry Piéton N/A N/A N/A Brett Wall 101.5% 24,214 24,578 Mike Marinaro 101.5% 17,093 17,350 Michelle Quinn N/A N/A N/A Fiscal Year 2027 PSU Design Change In fiscal year 2026, the Compensation and Talent Committee, in consultation with management and the Independent Consultant, modified the PSU design for senior executives, including NEOs.
Executive compensation / actual fiscal 2024–2026 PSU shares paid · Filed 17/08/2026
NEO actual total direct compensation was approximately 67% of the target opportunity as of the end of FY26, due primarily to underwater stock options.
Executive compensation / actual compensation relative to target · Filed 17/08/2026
In particular, the table below notes the features that are incorporated into our programs: Summary of Key Compensation Practices What We Do ü Pay and shareholder performance alignment ü Responsible use of shares under our long-term incentive program ü Multiple performance metrics under our short-and long-term performance-based plans discourage short-term risk-taking at the expense of long-term results ü Targets for performance metrics aligned to financial goals communicated to shareholders ü Payout caps on MIP and LTIP to mitigate unnecessary risk-taking ü Limited perquisites ü Double-trigger change of control vesting of compensation and benefits, including equity ü Clawback policy that applies to annual incentive, long-term incentives and equity compensation ü Competitive stock ownership guidelines and holding periods on portions of after-tax shares until guidelines are met ü Engagement of an independent compensation consultant What We Do Not Do ý No defined benefit supplemental executive retirement plans or special healthcare coverage for NEOs ý No “single-trigger” vesting of equity awards in event of a change of control ý No dividends or dividend equivalents on unearned equity compensation ý No excessive severance benefits ý No hedging and pledging of Company stock permitted for executives ý No “golden parachute” excise tax gross ups ý No backdating or repricing of stock option awards ý No multi-year compensation guarantees USE OF MARKET COMPETITIVE COMPENSATION DATA The Compensation and Talent Committee considers relevant market pay practices when establishing executive compensation program and pay levels, including base salary and annual and long-term incentives.
Executive compensation / clawback, ownership and compensation safeguards · Filed 17/08/2026
Beginning in fiscal year 2027, the MEDTRONIC I 2026 Proxy Statement 50 PSU metric mix will change from an equal blend of Revenue Growth and Relative TSR (50% weight for each goal) with a ROIC modifier to an equal blend of Revenue Growth and Gross Margin with a Relative TSR modifier.
Executive compensation / fiscal 2027 PSU metric design change · Filed 17/08/2026
Geoff Martha is an employee and is not independent; the remaining directors are independent.
Corporate governance / actual director independence · Filed 17/08/2026
Martha, each of the remaining committees consist entirely of independent directors.
Corporate governance / committee independence · Filed 17/08/2026
Other than the Growth and Operations Committees, which are chaired by Mr.
Corporate governance / CEO chairs Growth and Operations Committees · Filed 17/08/2026
Representative, recent discussion topics Responsibilities: •Financial reporting and significant accounting items •Review of the MiniMed Form S-1 filing and Diabetes carveout financials in anticipation of the MiniMed IPO •Data privacy and security •Company’s debt, capitalization, and dividend strategy •Compliance reporting and efforts to sustain ethical conduct •Ensures the integrity of the Company’s financial statements and financial reporting processes and oversees compliance with applicable legal and regulatory requirements as they relate to financial reporting and accounting; •Appoints, compensates (subject to applicable law), retains, oversees, and assesses the independence, qualifications, and performance of the Company’s independent registered public accounting firm and its lead audit partner, which reports directly to the Audit Committee; •Pre‑approves all audit, audit‑related, and permitted non‑audit services to be provided by the independent registered public accounting firm and establishes related approval policies and procedures; •Reviews the overall audit scope, planning, and results with the independent registered public accounting firm; •Reviews and discusses the Company’s annual and quarterly financial statements, related disclosures, and earnings releases, including critical accounting policies and practices with management and the independent registered public accounting firm; •Recommends, based on such review, whether the Company’s audited financial statements should be included in the Company’s Annual Report on Form 10‑K; •Reviews major accounting and auditing issues and changes, including the impact of regulatory developments, non‑GAAP measures, and off‑balance‑sheet arrangements on the Company’s financial statements; •Oversees the adequacy and effectiveness of the Company’s internal control over financial reporting and disclosure controls and procedures, including information technology and related security systems; •Oversees the Company’s internal audit function, including audit plans, resources, performance, and significant audit findings; •Establishes and oversees procedures for the receipt, retention, and treatment of complaints regarding accounting, internal accounting controls, or auditing matters; •Discusses the guidelines and policies governing the Company’s assessment and management of financial and compliance risks; and •Exercises general oversight of the Company’s risk management practices as they relate to financial reporting, accounting, compliance, and internal controls.
Corporate governance / Audit Committee activities and responsibilities · Filed 17/08/2026
Due to the Company retaining a controlling financial interest, the unaudited condensed consolidated financial statements include the financial results of MiniMed.
Basis of presentation / retained control and consolidation of MiniMed · Filed 03/09/2026
During the three months ended July 31, 2026, the Company had an increase of short-term borrowings of $812 million as compared to $649 million increase during the three months ended July 25, 2025.
MD&A / financing activities / increased short-term borrowings · Filed 03/09/2026
