Medtronic To Cut 500 Jobs In Minnesota
MINNEAPOLIS (AP/WCCO) – Medical device maker Medtronic will be cutting about 500 jobs in Minnesota, as part of an overall elimination of approximately 2,000 jobs worldwide.
About half of the jobs being eliminated are in the U.S., according to the Associated Press. A Medtronic spokeswoman said about 65 percent of the job cuts have already occurred. The rest will be eliminated in the current fiscal year that ends next April.
Out of the total 2,000 jobs to be cut 230 were announced by Medtronic earlier this month at the company’s Memphis-based spine facility.
Medtronic shares rose 5 percent Tuesday after the company reported better-than-expected fourth quarter earnings on sales of implantable heart defibrillators and pacemakers.
The world’s largest medical device maker reported net income of $969 million, or 95 cents per share, a decrease of 2 percent from $991 million in the prior-year period. Excluding one-time events and gains the company would have earned $1.12 billion, or $1.10 per share. Revenue rose 4 percent to $4.46 billion for the period ended April 26.
That was better than estimates of analysts polled by FactSet who predicted earnings per share of $1.03 on revenue of $4.38 billion.
“With our scale and breadth of innovative technology, Medtronic is clearly outperforming the market,” said CEO Omar Ishrak, in a statement.
Shares of Medtronic Inc. rose $2.58 to $52.47 in afternoon trading.
Sales of the company’s pacemakers and implantable defibrillators increased 3 percent to $1.33 billion, driven by international sales. Sales of spinal treatments slipped 1 percent to $811 million while neuromodulation devices increased 6 percent to $492 million.
The results suggest Medtronic may be regaining momentum after years of sluggish sales of its two leading products: implantable heart devices and spinal implants. The company’s defibrillators have been hurt by safety recalls and reduced medical spending.
The Minneapolis company’s spinal business has been hurt by revelations about the company’s handling of studies and marketing of its protein bone graft Infuse. Last year a Senate investigation concluded that the company helped write and edit medical journal articles about the graft that downplayed its risks. InFuse contains a genetically engineered protein that can stimulate bone growth.
For fiscal year 2014 Medtronic said it expects earnings per share between $3.80 and $3.85 on revenue of $17 billion to $17.2 billion.
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