“Our fiscal 2026 operating margin is expected to be roughly flat ex tariffs and down about 50 basis points including the tariffs impact.”

In context

“e impacts of business mix, primarily from cardiac ablation and diabetes. We anticipate a tariff impact to COGS of approximately $185 million, including $90 to $95 million in the third quarter. Including tariffs, we expect a fiscal 2026 gross margin decrease of roughly 40 basis points. We'll continue to fund R&D to grow greater than sales with SG&A in light of the outsized demand and building momentum for our enterprise growth drivers, we're capitalizing on every opportunity to accelerate our top line by strategically increasing sales and marketing investment in key programs. But will still deliver SG&A leverage on the full year by rigorously managing our G&A line. Taking all of this together, we expect fiscal 2026 adjusted operating profit to grow approximately 5% or 7% excluding tariffs. Our fiscal 2026 operating margin is expected to be roughly flat ex tariffs and down about 50 basis points including the tariffs impact. Now coming to EPS. Second quarter EPS came in $0.05 above the midpoint of our guidance. $0.03 5 of this beat was from reduced tax expense, I mentioned earlier, that we now expect to occur in Q4. We're flowing through the remainder of the Q2 beat and increasing our fiscal 2026 EPS guidance to a new range of $5.62 to $5.66 versus the prior range of $5.60 to $5.66. For Q3, we expect EPS in the range of $1.32 to $1.34. We're expecting margins to be down a couple of 100 basis points in Q3 as the quarter includes half the annual impact of tariffs. In addition, the expected growth acceleration in CAS and diabetes will continue to impact business mix. And Q3 is typically our lowest quarter for generating COGS efficiency savings given the holidays. However, we do expect Q4 margins to increase year”