Geoffrey S. Martha
Chairman and Chief Executive Officer at Medtronic
Hello everyone and thank you for joining us today. We started off fiscal 2022 with a strong first quarter beating Street estimates on revenue, margins, and EPS. We drove market share gains across a number of our businesses, including three of our largest: cardiac rhythm, surgical innovations, and spine.
Our results reflected the recovery of elective procedures during the quarter with most of our businesses finishing at or above pre-COVID levels. Now while the delta variant is having an impact on procedure volumes in certain geographies, we believe the effects will be manageable. Healthcare systems are really just better prepared and vaccination rates continue to increase.
Our new operating model and the Medtronic mindset culture enhancements are delivering results as our first quarter performance demonstrates. Our employees are energized by the transformation of our organizational structure and the competitive culture. And our most recent employee engagement survey results were the strongest that we've ever had. We continue to focus on accelerating and sustaining higher top and bottom line growth at Medtronic.
In fact, we've already made a number of disciplined and targeted capital allocation decisions that drive that acceleration. We've increased our investments at the front-end of major product launches in surgical robots and renal denervation, which represent large new markets for Medtronic.
We're growing our R&D investments broadly across the company, complementing a long list of organic opportunities with disciplined tuck-in acquisitions such as our recently announced intent to acquire Intersect ENT. Now, we expect these actions to drive share gains in our markets today, which we've talked a lot about and to increase our weighted average market growth rate, producing stronger returns for our shareholders.
Now turning to the details of our first quarter results, we'll start again with a brief look at our market share performance. It's an important metric that our teams are being evaluated against along with revenue growth, profit, and free cash flow. We continued to see a number of our businesses winning share driven by our innovation and increased competitiveness. And it's worth noting that when we talk about our share dynamics, we're referring to revenue share in calendar quarter Q2.
We gained share in our three largest businesses this quarter. Our cardiac rhythm management business continued to perform well above the market adding over 3 points of share driven by our differentiated Micra family of pacemakers, Cobalt and Crome high-power devices, and our TYRX Antibacterial Envelopes.
In surgical innovations, we gained share as our Endo Stapling and advanced energy technology continues to be the preferred and trusted instruments used by surgeons all around the world. And in spine, the ecosystem that we offer of spine implants, biologics, and enabling technologies like the pre-operative planning software, robotics, imaging, and navigation resulted in above market growth for Medtronic.
And it's not just our largest businesses that are winning share. We also had share gains in some of our faster growing businesses like TAVR, Pelvic Health, and Pain Stim. As new evidence, technology and sales execution resulted in Medtronic outpacing our competition. In Pain Stim, we did observe gradual slowdown in permanent implants and trialing procedures in the latter parts of our quarter due to the delta variant and we do expect that this will affect the market during Q2.
That said, we continued to win share and have a lot of momentum in our Intellis with DTM technology and with the launch of the Vanta recharge-free system, our portfolio is complete, highly competitive, and well positioned. Now while we're winning share in a number of our businesses, we still have areas where we have work to do.
In cardiovascular, we continue to lose share in our cardiac diagnostics business. However, we do expect these trends will reverse over the course of our fiscal year as we ramp up supply of our LINQ II insertable cardiac monitoring system. Now we also lost share year-over-year in neurovascular, but we were pleased with our momentum as we ramped our recent product launches. This included our two new flow diverters: the Pipeline Flex with Shield Technology in the U.S. and the Pipeline Vantage in Europe as well as our Solitaire X 3-millimeter stent retriever.
And finally, in diabetes, we continue to execute our turnaround strategy, but as expected, we continued to lose share in the U.S. as we wait for new product approvals. We understand the current challenges we face in diabetes and we believe our product pipeline and our differentiated technologies will return us to market growth as these products move through development approval and ultimately become available to patients.
Now speaking of new products, let's now turn to our product pipeline. Today, you're seeing the strong flow of new products launching across our businesses. We've launched over 190 products in the U.S., Western Europe, Japan, and China in just the last 12 months. We also continue to advance the innovation we have in development.
We're increasing our R&D spend by more than 10% this fiscal year. This is the biggest dollar increase in R&D spend in our company's history. The investments we're making in our pipeline will play a key role in accelerating our top line growth and we're at the front-end of some large opportunities to win share, create new markets, and disrupt existing markets.
Starting with one of our largest future growth drivers, renal denervation. We're making good progress on our solution to go after this multi-billion dollar hypertension opportunity. We expect that the results of our ON MED pivotal trial will be ready for a presentation at the TCT Conference in November assuming the interim look at this Bayesian design study reaches statistical significance. The ON MED clinical trial represents the final piece of a large body of evidence that we intend to submit to the FDA for approval.
The progress on our surgical robotics business has been impressive in recent months and we have momentum on a number of important milestones and initiatives but most notable and something that has energized our entire company and the robotics team, the first procedures with Hugo were performed at Clinica Santa Maria in Chile by Dr. Ruben Olivares in June. And as is said, a picture is worth a thousand words. So let's watch this short clip detailing this important milestone.
[Video Presentation]
It's truly amazing to see our robotic technology in use and I want to thank the hundreds of Medtronic employees that have worked tirelessly over many years as well as the surgeon and hospital leaders whose partnership helped make Hugo a reality. We look forward to expanding the surgical robotics market by addressing the per procedure cost and utilization barriers that have limited robotic surgery to date. And shortly after the first urological procedures in Chile, we had the first gynecological procedures performed last month at the Pacifica Salud hospital in Panama.
We're receiving positive feedback from early users for our approach to robotic surgery including our thoughtful design choices. For example, as you can see by this picture, our open console design allows for natural interaction and participation of the entire surgical team. And it's just one of the many important differentiated features of Hugo.
Looking ahead, we remain on track for CE Mark approval of Hugo following our submission in late March and we continue to make progress towards starting our U.S. Expand URO pivotal trial where the first procedures in the U.S. will occur. Around the globe, a number of hospital systems have expressed interest in our Partners in Possibility Program, joining a group of pioneering hospitals that will be among the first to use Hugo.
In cardiac rhythm, we filed for CE Mark for our extravascular ICD this quarter and enrollment is going well in our U.S. pivotal trial. EV-ICD represents a disruptive technology in implantable defibrillator space as it can pace and shock without leads inside the heart and they can do all of this in a single device with the same size and longevity of a traditional ICD.
In TAVR, we continue to advance our Evolut platform and I am pleased to share with you the news today that we just received FDA approval last week for our next-generation Evolut FX TAVR system. Now this innovative system is designed to improve the overall procedural experience through enhancements and deliverability, implant visibility, and deployment stability. We're planning to start rolling out this next-gen system in the U.S. market later this fall.
In neuromodulation, in addition to receiving FDA approval in the quarter for our Vanta recharge-free spinal cord stimulator, we also received FDA approval for our Sensight directional deep brain stimulation lead. Now Sensight combined with our recently approved Percept PC system is the only DBS system on the market that can sense and record brain activity in addition to providing normal stimulation to treat diseases like Parkinson's and essential tremor. We also remain on track to submit our ECAP spinal cord stimulator to the FDA later this calendar year, which has the potential to be a disruptive technology in Pain Stim.
Now moving to our Pelvic Health business, as you know, we don't reveal all of our development programs underway at Medtronic for competitive reasons, but I'm going to unveil a new one today. We've been working in stealth mode on our next-gen InterStim recharge-free device and earlier this month, we submitted our PMA supplement to the U.S. FDA seeking approval. Now this device some very attractive specs. It's designed with a 10-year battery, it's got constant current and its full body MRI compatible at both 1.5 and 3 Tesla. We're expecting approval in the first half of next calendar year and we can't wait to have this best-in-class recharge-free device available for patients.
In diabetes, the international launch of our MiniMed 780G Insulin Pump continues to go well. The 780G has the highest reported time and range of any insulin pump. And starting this fall, people with diabetes in many international markets will not only have access to the 780G but also our no calibration seven-day Guardian 4 sensor and our seven-day Extended Infusion Set, the longest lasting set on the market.
This complete offering will be highly differentiated and ease patient burden and we're working to bring this technology to other markets. In the U.S., the 780G and Guardian 4 sensor continue to be under active review with the FDA and we're expecting to submit our next-gen Synergy CGM sensor to the FDA in Q3. Synergy is disposable, easier to apply, and half the size of our current sensor. I'll now turn it over to Karen to discuss our financial performance and our guidance. Karen?
