“As a reminder, we expect the impact of tariffs to increase each quarter this year as tariff expense rolls through inventory into cost of sales.”

In context

“Q2 results also reflected an impact of approximately 60 basis points from tariffs. Clearly, the trade environment continues to be dynamic. We are currently estimating the impact of tariffs for the year to be approximately 100 basis points, plus or minus 20 basis points, lower than the estimate we provided on last quarter's earnings call, primarily reflecting the reduction of bilateral tariff rates relating to U.S.-China trade. Our estimate for the year assumes the following: imports from China to U.S. bear a tariff rate of 30%. Imports into China of subassemblies and finished goods from the U.S. are subject to a 10% tariff. Imports into the U.S. from all other countries bear a 10% tariff rate and the imports from Mexico and Canada that comply with USMCA continue to be exempt from tariffs. As a reminder, we expect the impact of tariffs to increase each quarter this year as tariff expense rolls through inventory into cost of sales. Given the uncertainty surrounding what tariff rates will ultimately be enacted, it is possible future tariff rates could have a significant incremental impact on our cost of sales. During the quarter, we opened a new 187,000 square foot manufacturing facility in Bulgaria with land to expand further as needed. This site will initially be focused on our portfolio of more mature endoscope products. Over time, we expect to further increase our manufacturing footprint in Germany and Mexico, given our midterm needs for additional capacity to support revenue growth and our strategy to operate at industrial scale. Second quarter pro forma operating expenses increased 9% year-over-year, driven by higher headcount and increased facility costs, including depreciation, partially offset by lower legal”