By Sriparna Roy and Mariam Sunny
(Reuters) -Medtronic lifted the lower end of its annual profit forecast for a second time on Tuesday, banking on sustained demand for its medical devices in the United States.
Its shares still fell nearly 3% in early trading.
"The guidance increase for the year was still relatively small ... So it's possible people were looking for more," said Jeff Jonas, portfolio manager at Gabelli Funds.
Investors had also set a high bar for results from medical device makers as the companies have benefited from healthy demand for non-urgent surgeries, especially among older Americans, over the last few quarters.
Peers Boston Scientific (NYSE:BSX) and Abbott raised their annual profit forecasts last month.
Medtronic (NYSE:MDT) expects to report high-single-digit growth in adjusted profit in the back half of the fiscal year, as the negative impact from foreign-currency fluctuations abates.
The company is looking "aggressively at dynamically pricing" in markets with negative foreign currency impacts, interim CFO Gary Corona said on a call with analysts.
The Ireland-based company raised the lower end of its 2025 adjusted profit forecast to $5.44 per share from $5.42 earlier, keeping the upper end at $5.50. The new midpoint of $5.47 is slightly higher than analysts' estimates of $5.45, according to data compiled by LSEG.
It posted adjusted profit of $1.26 per share for the second quarter, compared with estimates of $1.25.
The beat was not as substantial on profit, which is what investors were looking for Medtronic to deliver on, said RBC Capital Markets analyst Shagun Singh Chadha.
The company's total revenue for the quarter ended Oct. 25 rose 5.3% to $8.40 billion, compared with expectations of $8.27 billion.
It posted estimate-beating revenue across segments except for its medical surgical unit, where sales came in line with projections.
Medtronic expects the unit, which was affected by a slowdown in some Asian markets, to return to more normalized growth in the third quarter, said CEO Geoff Martha.