In an era defined by economic volatility, global supply chain constraints, and rising healthcare costs, Stryker is demonstrating how a medical device company can not only adapt but thrive. At the 2024 Bank of America Healthcare Conference, Stryker’s newly appointed CFO Preston Wells along with Jason Beach, vice president of finance and investor relations, shared an in-depth look at the company’s operating strategy, innovation roadmap, and growth outlook.
This article examines how Stryker is executing its strategies in a complex and evolving macroeconomic environment, balancing the pressures of inflation, supply chain constraints, and global competition while driving operational discipline, expanding its differentiated robotics portfolio, launching new trauma systems, and leveraging tuck-in acquisitions. It also provides a deep dive into the company’s business model, product development priorities, innovation pipeline, and the market expectations shaping its performance throughout 2025.
Profitability and Capital Allocation
Wells, who has been with the company for over a decade, characterized the CFO transition as seamless. “I’ve had the fortune of being at Stryker for the last 10 years, so I’m already a part of the agenda,” he said. “It’s still going to be a focus on driving our top-line growth through our differentiated commercial strategy and M&A.”
Wells reaffirmed Stryker’s commitment to improving profitability. “A couple of years ago we committed to a 200-basis-point improvement over two years, and we’re still on that journey — on track to get there by the end of this year,” he said. The longer-term goal is to institutionalize a minimum of 30 basis points of margin expansion annually thereafter.
At the heart of Stryker’s performance is its category-focused commercial model. “We’re not overly reliant on any one product or part of the business,” Wells explained. Instead, the company’s organizational structure aligns dedicated sales, marketing, and R&D teams around specific call points, such as orthopedics, trauma, and surgical visualization. This specialization allows for rapid deployment of innovation and close alignment with clinician needs.
This model also enhances agility. “We’re really close to our customers,” Wells said. “It allows us to understand not only what their current needs are, but how those needs might change in dynamic environments.”
The recent divestiture of Stryker’s spine business and the acquisition of Inari Medical reinforce this strategic intent. “Inari brings us into a faster-growing segment that complements our portfolio,” said Wells, adding that it is part of the company’s broader effort to pivot toward high-growth, high-impact areas of medicine.
Robotics, Cameras, Trauma Systems
Stryker’s product portfolio is engineered for longevity. “The beauty of our launches is that they’re multi-year,” said Wells. “Something like Pangea will drive benefit over multiple years. Even 1788, which we talked about two or three years ago, is still contributing strong growth.”
Mako, the company’s flagship orthopedic robotics platform, continues to generate robust demand. “We’ve had record placements for many quarters in a row,” said Wells. “And with every new placement, we see a ramp-up in procedure volume six to nine months later.”
Stryker is now expanding Mako’s capabilities with the launch of Mako 4, which supports hip revisions and complex hip procedures. The aim is to convert more surgeons — and ultimately more procedures — to the robotic platform.
Shoulder and spine procedures are also being integrated into the Mako system. “By leveraging our large installed base, we can add incremental value,” Wells noted. “We’re already number one in shoulder. Robotics will help us grow that market further by expanding the total number of procedures.”
The 1788 camera platform, now in its second year postlaunch, is another growth driver. “You’re looking at three-to-five-year cycles on products like this,” said Wells. “We expect another strong year in 2025.”
Pangea, Stryker’s advanced trauma system, is also contributing significantly. “We’ve been very good in nailing, not as good in plating,” Wells said, referring to the trauma product mix. “Now we’re able to go out and earn some share.” Pangea has already been a growth catalyst in the U.S. and is preparing to expand into international markets, where additional upside is expected in the coming quarters.
Pricing Discipline and Margin Expansion Amid Inflation and Tariffs
Even amid persistent inflation and global trade disruptions, Stryker has learned to protect and expand margins. “We learned a lot during the 2022 inflationary environment,” Wells said. “We’re in a much better position now.”
Pricing discipline is a key component. “Historically, our orthopedics business saw two to three points of annual price erosion,” he noted. “Now we’re flat or only slightly down. And our medsurg segment has actually gone price-positive.”
The company is actively mitigating tariff impacts — particularly those stemming from U.S.-China trade tensions. Of the $200 million in tariff exposure originally estimated, new policy changes could reduce that by $25 million to $50 million. “We’re still evaluating the implications,” said Beach, “but we’re focusing on dual sourcing and trading line optimization — steps we should be taking anyway.”
Another advantage is the company’s improved pricing muscle. “We’ve gotten better at putting the right pricing behind the value that we bring,” Wells said. “That’s now embedded into our commercial approach.”
M&A Remains a Core Growth Strategy
Stryker remains highly acquisitive. “We did seven acquisitions last year,” said Beach. “They’re starting to gain momentum and will continue to be a tailwind in 2025 and beyond.”
Inari Medical is the most recent example, with integration now underway. “We appointed Tim Lanier, formerly from our trauma and extremities business, to lead Inari,” said Wells. “We’ve also infused it with internal talent, creating a strong mix of legacy Stryker and Inari leadership.”
Cost synergy expectations remain high. “We guided 0–20 basis points of dilution for Inari,” Beach said. “And with our most recent guidance, it’s zero — even after absorbing tariff impacts. That speaks to our confidence in realizing synergies.”
While the company is not pursuing transformative M&A deals at this time, smaller tuck-in acquisitions aligned with specific call points are on the table. “M&A is absolutely part of our ongoing growth strategy,” said Wells.
Capital Equipment Demand Remains Strong
Despite macroeconomic uncertainty, demand for Stryker’s capital equipment remains robust. “Our order book is as strong as it’s ever been,” said Wells. “Orders are ramping up quarter by quarter. It gives us a very clear picture of revenue trajectory for the next several quarters.”
This sustained demand is driven by the profitability of procedures that Stryker products support. “In times of budget tightening, hospitals still prioritize investments in procedures that drive their own financial performance,” Wells explained.
The LP 35 defibrillator platform is gaining traction in the U.S. market, with international expansion expected in 2025. “We’re seeing strong sales and robust order books,” said Wells. “It’s already a meaningful contributor to our growth.”
Stryker’s small capital equipment line — like surgical cameras and light sources — also continues to show cyclical growth. “These products have multiyear replacement cycles,” Wells noted. “We expect to ride the tailwind of previous investments through 2026.”
Prepared for Recession or Regulation
Stryker believes it is well positioned to weather a broader economic slowdown or healthcare policy shift. “We have flexibility in how we structure capital sales — direct or through financing,” said Wells. “And our products support hospital profitability, which makes them resilient in downturns.”
Internally, Stryker has cultivated cost discipline and scalable infrastructure. “Shared services, back-office technology, and repeatable cost-down processes give us the agility to offset margin dilution from new deals or inflation,” said Wells.
Beach emphasized that margin preservation is non-negotiable. “We want growth, but we want profitable growth. Every deal has to meet that standard.”
Additionally, Stryker’s learnings from previous inflationary cycles have positioned it to respond faster to cost pressures. The company has built dual sourcing strategies and improved its ability to adjust contract pricing based on cost structures.
Looking Ahead: November Analyst Day to Set Next Milestone
Stryker’s next major update will come in November during its Analyst Day, where the company plans to detail its long-term growth framework, innovation roadmap, and financial targets. “Just like in prior years, we’ll use that forum to outline the next leg of our journey,” said Beach.
While specific numbers will be shared later, the philosophy remains unchanged. “Growth and profitability are not mutually exclusive,” Wells concluded. “Our model, our discipline, and our product pipeline make us confident that we can continue to deliver both — year after year.”
For medical device engineers and designers, Stryker’s performance narrative offers more than just financial benchmarks. It demonstrates the impact of category-focused organizational design, sustained engineering investment, and cross-functional collaboration between R&D and commercial teams. As the company builds toward its next phase of innovation and integration, opportunities for system-level thinking — from robotics to software to capital infrastructure — will only increase.
This article was written by Sherrie Trigg, Editor and Director of Medical Content. She can be reached at
