A maker of medical devices and surgical robotics, Stryker sells everything from joint replacements and spinal implants to endoscopes and the Mako robotic surgery platform, used by hospitals and surgeons around the world. It began in 1941, when Michigan orthopedic surgeon Dr. Homer Stryker, frustrated that his tools didn't work, started the Orthopedic Frame Company in his basement to sell his own inventions—including a cast cutter he built from a malted milk mixer motor. The firm was renamed Stryker in 1964 when its founder retired.
Stryker's Q2 gross margin rose 4.5 points to 68.3% as a tariff reversal and lower acquisition costs dropped to the bottom line.
A one-time tariff reversal reshaped the quarter. rose 9.4% to $6.6 billion and widened 6.7 points to 25.2%, driven almost entirely by a 450-basis-point expansion from the reversal of 2025 import tariffs and lower charges. The underlying business grew steadily, but the reported profit increase is not repeatable.
Key takeaways
Reported expanded 450 to 68.3%, primarily because of a reversal of 2025 import tariffs that added 260 basis points and a 110-basis-point benefit from lower of stepped up to fair value from the Inari Medical acquisition.
Consolidated rose 9.4% to $6.6 billion, with unit volume contributing the majority of growth and pricing adding 0.3 percentage points, while foreign currency provided a 1.6-point .
MedSurg and Neurotechnology sales grew 9.7%, led by a 13.4% increase in Medical and an 11.7% rise in Endoscopy; Vascular declined 0.7% as the Inari Medical acquisition anniversary passed.
Section summaries
Management's Discussion and Analysis
Q2 2026 sales rose 9.4% to $6.6B; adjusted EPS grew 17.9% to $3.69 driven by volume, tariff reversals, and margin expansion.
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Consolidated grew 9.4% as reported (9.0% ) in Q2 2026, driven by higher unit volumes across most MedSurg and Neurotechnology and all Orthopaedics businesses.
Orthopaedics sales rose 9.1%, with Trauma and Extremities up 11.9% and the newly formed Ortho Tech up 10.3%, partially offset by a near-total exit from Spinal Implants.
Adjusted expanded 170 to 27.4%, reflecting the gains and SG&A from continued spending discipline.
rose 13.5% to $1.26 billion, and increased 14.1% to $1.06 billion, as improvements more than offset acquisition-related outflows.
What changed
The March 2026 cyber incident that compressed Q1 by 0.5 points did not repeat: gross margin rebounded from 63.3% in Q1 to 68.3% in Q2, though the 450-basis-point expansion was overwhelmingly driven by the tariff reversal and lower charges, not operational recovery.
The charges from the Inari Medical acquisition that had weighed on for several quarters fell sharply, contributing a 110-basis-point in Q2 2026 after being a persistent through 2025.
The Spinal Implants divestiture, flagged as a watch item across multiple prior filings, is now a near-total exit, pulling Orthopaedics' reported growth down in prior quarters but now largely lapped, allowing the to post 9.1% growth.
returned above $1 billion in Q2 2026 after Q1's $415 million, consistent with the seasonal pattern of Q1 timing that had been flagged in earlier quarters.
What to watch
Whether reported normalizes back toward the 63-64% range in Q3 2026 once the one-time tariff reversal and lower charges are fully lapped.
The trajectory of the new Ortho Tech now that the Spinal Implants divestiture is largely complete and historical results have been recast.
Whether Vascular returns to growth after the 0.7% decline in Q2 2026, as the Inari Medical acquisition anniversary passes and organic comparisons become cleaner.
Any regulatory, legal, or customer consequences from the March 2026 cyber incident, which the company flagged as an ongoing risk factor but did not quantify in Q2 results.
expanded 450 to 68.3% in Q2 2026, primarily due to a reversal of 2025 import tariffs (260 bps benefit) and lower of (110 bps benefit).
MedSurg and Neurotechnology sales increased 9.7% as reported, led by Medical (13.4%) and Endoscopy (11.7%), while Vascular declined 0.7%.
Orthopaedics sales increased 9.1% as reported, with Trauma and Extremities up 11.9% and Ortho Tech up 10.3%, partially offset by a near-total exit from Spinal Implants.
increased 170 to 27.4% in Q2 2026, reflecting gains and SG&A from continued spend discipline.
rose to $1.84B in H1 2026 from $1.36B in H1 2025, driven by improvements, while the company repaid $1.0B in maturing notes.
Quantitative and Qualitative Disclosures About Market Risk
We consider our greatest potential area of market risk exposure to be exchange rate risk on our operating results. Quantitative and qualitative disclosures about exchange rate risk are included in Item 7A "Quantitative and Qualitative Disclosures About Market Risk" of our Annual…
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We consider our greatest potential area of market risk exposure
to be exchange rate risk on our operating results. Quantitative
and qualitative disclosures about exchange rate risk are included
in Item 7A "Quantitative and Qualitative Disclosures About Market
Risk" of our Annual Report on Form 10-K for 2025. There were
no material changes from the information provided therein.
We are not aware of any material changes to the risk factors included in Item 1A. "Risk Factors" in our Annual Report on Form 10-K for 2025 and Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026.
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We are not aware of any material changes to the risk factors
included in Item 1A. "Risk Factors" in our Annual Report on Form
10-K for 2025 and Part II, Item 1A. "Risk Factors" in our Quarterly
Report on Form 10-Q for the quarter ended March 31, 2026.