On Tuesday, Medtronic disclosed its third-quarter results for fiscal year 2026, reporting a revenue of $9 billion, up 8.7% year over year, or 6% organically. Medtronic’s stock fell despite beating Wall Street expectations with earnings per share of $1.36.

The company’s operating profit experienced a dip, as well, and the company blames a “potential impact” of $185 million resulting from tariffs. Higher expenditures, particularly on products sold and R&D, also explained the dip, as did several major investments the company made to expand its portfolio.

The company recently received FDA clearance for its Hugo robotic-assisted urological surgery and, just last week, for its Stealth AXiS Surgical System for spinal procedures. Medtronic has also initiated an acquisition of CathWorks, a med tech company that specializes in coronary artery diseases, for $585 million.

“By unlocking new markets and investing in high-growth opportunities, we are accelerating performance across the company,” said Geoff Martha, Medtronic chairman and CEO, in the press release. “Our innovation pipeline and portfolio breadth give us confidence in our ability to sustain long-term growth.”

Notably, Medtronic’s diabetes division earned $796 million in revenue, with organic growth of 8.3%. The med tech company is currently in the process of spinning off the division into its own publicly held company, after filing an IPO in December.

In fiscal year 2025, 8% of the company’s revenue came through the diabetes unit. Upon completion by the end of this year, the spinoff is expected to improve the company’s adjusted gross margin by approximately 50 basis points.