Stryker Corporation (SYK Quick QuoteSYK - Free Report) reported second-quarter 2025 adjusted earnings per share (EPS) of $3.13, which beat the Zacks Consensus Estimate of $3.06 by 2.3%. The bottom line also improved 11.4% year over year. Our model estimate for the metric was pegged at $3.06 per share.

GAAP EPS was $2.29, up 7% from the year-ago quarter’s level.

Revenue Details

Revenues totaled $6.02 billion, which beat the Zacks Consensus Estimate by 1.1%. The top line also improved 11.1% on a year-over-year basis and 10.2% at constant currency (cc). Our model estimated total sales of $5.88 billion. The growth reflects strong demand across the product portfolio.

Stryker Corporation Price, Consensus and EPS Surprise

Stryker Corporation price-consensus-eps-surprise-chart | Stryker Corporation Quote

Revenues by Geography

Revenues in the United States amounted to $4.55 billion, up 2.5% from the prior-year quarter’s level. International sales increased 6.8% year over year to $1.47 billion despite supply-chain challenges with notable contributions from South Korea and emerging markets.

Segmental Analysis

Stryker signed an agreement during the first quarter to sell its U.S. spinal implants business to Viscogliosi Brothers, LLC, a family-owned investment firm specializing in the neuro-musculoskeletal space. The new company will be called VB Spine, LLC. Stryker also plans to sell its related international business. The divestment was completed in April.

Effective from the fourth quarter, its Spine enabling technologies results are reported as part of other orthopedics. Interventional Spine results are reported as part of neurocrine. As a result, spinal implants are now reported separately within orthopedics.

MedSurg and Neurotechnology: This segment reported sales of $3.77 billion, up 17.3% year over year and 16.7% at cc. Our model estimate for sales was $3.54 billion.

In the quarter under review, MedSurg and Neurotechnology recorded organic sales growth of 11%, which included 12.5% of U.S. organic growth and 5.7% of international organic growth. Instruments recorded U.S. sales growth of 10.1%, led by healthy growth in the Surgical Technologies business.

Endoscopy saw 19.1% U.S. growth on the back of robust demand for operating room infrastructure and renovations and the continued success of the 1788 video platform as well as the Sports Medicine business. Medical grew 9%, led by the acute care business, partially offset by lower sales in the emergency care business due to continuing supply disruptions.

Vascular grew 111% organically in the United States, driven by strong hemorrhagic sales. Internationally, sales were up 15%. Neurocranial saw 19.8% growth, led by strong demand for neurosurgical, IVS businesses and cranial maxillofacial products.

International sales were driven by growth in neurocranial, endoscopy and vascular businesses, especially strong performances in South Korea, Canada and its emerging markets.

Orthopedics: Sales in the segment amounted to $2.25 billion, up 2% year over year and 1.1% at cc. Organically, sales were up 9%, which included organic growth of 9.7% in the United States and 7.5% internationally. The knee business grew 6.3%, reflecting its market-leading position in robotic-assisted knee procedures and momentum from the continued strength of its new Mako installations. Our model estimated Orthopedics sales to be $2.33 billion.

U.S. hips business grew 8.4%, driven by Insignia hip stem success and Mako robotic platform momentum. Trauma and Extremities business surged 15%, led by strong core trauma and upper extremities growth. Spinal implants declined 97.2%, while the strength of Mako installations and a strong performance in navigational technology products led to a 9.6% expansion in other ortho sales. International Orthopaedics grew 3.1%, with strength in emerging markets like Japan, South Korea and many of its emerging markets.

Margins

Adjusted gross profit totaled $3.93 billion in the reported quarter, up 13% from the year-ago quarter’s level. Adjusted gross margin expanded 110 basis points (bps) to 65.3%. The improvement was primarily driven by positive pricing, manufacturing cost improvements and mix.

Total operating expenses were $2.73 billion, up 15.3% from the year-ago quarter’s level.

Adjusted operating income totaled $1.55 billion, up 15.8% from the year-ago level. Adjusted operating margin was 25.7%, up 110 bps.

Financial Update

Stryker exited the second quarter with cash and cash equivalents of $2.38 billion compared with $2.34 billion at the end of the first quarter of 2025.

Cumulative net cash provided by operating activities totaled $1.36 billion compared with $837 million a year ago.

2025 Guidance

Stryker raised its guidance for 2025. The company now expects total revenues to grow in the range of 9.5-10% on an organic basis (previously 8.5-9.5%). The Zacks Consensus Estimate for total revenues is pegged at $24.84 billion, implying growth of 10%.

SYK raised its EPS guidance to $13.45-$13.60 from $13.20-$13.45. The Zacks Consensus Estimate for earnings is pegged at $13.35 per share.

Wrapping Up

Stryker’s second-quarter 2025 performance reflected strong execution, fueled by robust procedural demand, innovation uptake and productivity gains across its diversified portfolio. Both of its major business segments — MedSurg and Neurotechnology, and Orthopaedics and Spine — benefited from sustained hospital activity and growing adoption of key technologies. Management highlighted particular strength in U.S. Knee and Mako robotic installations, with Mako procedures growing 27% year over year.

Despite a strong quarterly performance, shares of SYK were down 5.8% during after-hours trading on July 31. The stock has risen 3.9% year to date compared with 4.3% growth of the industry. The broader S&P 500 Index has moved down 5.7% in the same period.

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Momentum in Mako robotic-assisted surgeries remained a highlight, with significant growth in procedure volumes and continued customer expansion. The launch of the Triathlon Hinge Knee and Insignia Hip Stem supported strong implant utilization, while Stryker’s Endoscopy and Instruments lines continued to see healthy demand in ambulatory and inpatient settings. The company also noted progress in its spine and trauma franchises despite ongoing challenges in China due to regulatory volume controls.

Margin expansion in the quarter was driven by multiple factors. Improved supply-chain conditions enabled better fulfillment and lower freight costs, while pricing initiatives continued to gain traction across key markets. Stryker also benefited from operating leverage, as higher procedural volumes translated to greater cost efficiency.

Stryker management that new product contributions and a more stable macro environment, particularly in the United States and key developed markets, are helping offset inflationary pressures and international headwinds. Recovery in Europe and Japan further supported operational strength, while emerging markets, excluding China, delivered healthy results.

Zacks Rank & Stocks to Consider

Stryker currently carries a Zacks Rank #3 (Hold)

Some better-ranked stocks from the broader medical space that are expected to report earnings soon are Align Technology (ALGN Quick QuoteALGN - Free Report) , Cardinal Health, Inc. (CAH Quick QuoteCAH - Free Report) and Cencora, Inc. (COR Quick QuoteCOR - Free Report) .

The Zacks Consensus Estimate for Align Technology’s second-quarter 2025 adjusted EPS is currently pegged at $2.57. The consensus estimate for revenues is pegged at $1.06 billion. ALGN currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Align Technology has an estimated long-term growth rate of 11.2%. However, ALGN’s earnings yield is 5.1% compared with the industry’s 5.4%.

Cardinal Health currently has a Zacks Rank #2. The Zacks Consensus Estimate for fourth-quarter fiscal 2025 adjusted EPS is currently pegged at $2.03 and the same for revenues is pinned at $60.67 billion.

Cardinal Health has an estimated long-term growth rate of 10.9%. CAH’s earnings yield of 5.7% compares favorably with the industry’s 5.5%.

Cencora currently carries a Zacks Rank #2. The Zacks Consensus Estimate for third-quarter fiscal 2025 adjusted EPS is currently pegged at $3.78 and the same for revenues is pinned at $80.33 billion.

Cencora has an estimated long-term growth rate of 12.8%. COR’s earnings yield of 5.4% compares favorably with the industry’s 4.1%.