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SOLV's Q3 Earnings: Can Growth Momentum Offset ERP-Related Headwinds?
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Key Takeaways
SOLV's Q3 earnings are projected to decline 8%, with revenues down 6% ahead of its Nov. 5 earnings release.
Solventum faces a $125M ERP-related order reversal, potentially reducing third-quarter sales growth by 3-4%.
SOLV's MedSurg and Dental momentum, Acera's 48% Q2 growth and product innovation may support Q3 results.
Solventum Corporation (SOLV - Free Report) is scheduled to report third-quarter 2026 results on Nov. 5, after market close. The quarterly results are likely to reflect continued growth across MedSurg and Dental, supported by strong commercial execution, product innovation and increasing adoption of key growth drivers. However, the reversal of Q2’s ERP-related advance orders, ongoing implementation challenges and tariff pressures are expected to have weighed on reported growth and margins.
Investors will closely monitor organic sales growth, ERP-related order normalization, margin trends and Acera’s growth momentum. Management’s commentary on the HIS separation, completion of the 3M separation and progress toward its long-term growth and profitability targets will also be key.
Over the past three-month period, SOLV shares declined 7.7%, underperforming the Zacks Medical Services industry and the S&P 500 Index, which advanced 10% and declined 1.9%, respectively.
Image Source: Zacks Investment Research
SOLV’s Earnings Surprise History
SOLV beat on earnings in all the trailing four quarters, delivering an average surprise of 13.18%.
Image Source: Zacks Investment Research
SOLV’s Q3 Consensus Estimate
The Zacks Consensus Estimate for third-quarter earnings is pinned at $1.38 per share, indicating a decline of 8%. The earnings estimate has remained unchanged over the past seven days. The consensus estimate for revenues is pinned at $1.97 billion, suggesting 6% year-over-year decline.
Quarterly Drivers
Strong MedSurg and Dental Momentum: Solventum’s MedSurg and Dental businesses are expected to have remained key growth drivers, supported by improving commercial execution, product innovation and increasing adoption of differentiated solutions. Acera’s strong momentum, evident from the second-quarter sales growth of 48%, and continued demand for advanced wound care and dental products are likely to have supported underlying performance in the third quarter.
Innovation and Growth Driver Adoption: Increasing penetration of higher-value solutions across IV site management, advanced wound care and dental aesthetics is likely to have supported sales growth. Recent product launches, including V.A.C. Peel and Place and new Attest sterilization products, along with Acera’s differentiated Restrata technology, are likely to have contributed to customer conversions and revenue momentum.
Challenges
ERP-Related Order Reversal: The reversal of approximately $125 million in ERP-related advance orders recorded in the second quarter is expected to have weighed on third-quarter reported sales. Management indicated that this reversal could result in a 3-4% decline in sales growth, making inventory replenishment and the successful execution of the final ERP cutover critical to limiting further disruption.
Tariff and Inflationary Pressures: Margin performance is likely to remain under pressure from tariffs, inflation and ongoing transformation-related costs. Second-quarter gross margin, excluding the $100 million tariff refund, declined 40 basis points year over year, reflecting tariff and inflation headwinds. The absence of a similar tariff refund benefit in the third quarter could also weigh on year-over-year earnings comparisons.
Our proven model predicts an earnings beat for SOLV this earnings season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is exactly the case here, as you can see below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +10.15%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Glaukos reported second-quarter 2026 earnings per share (EPS) of 14 cents, which beat the Zacks Consensus Estimate by 50.00%. Revenues of $186 million surpassed the Zacks Consensus Estimate by 24.1%.
Glaukos has an estimated earnings growth rate of 268.8% for 2027. GKOS’ earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 25.87%.
Edward Lifesciences reported second-quarter 2026 adjusted EPS of 78 cents, which beat the Zacks Consensus Estimate by 6.85%. Revenues of $1.74 billion surpassed the Zacks Consensus Estimate by 2.45%.
Edward Lifesciences has an estimated long-term earnings growth rate of 12.7%. EW’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 4.49%.
Globus Medical reported a second-quarter fiscal 2026 adjusted EPS of $1.34, which beat the Zacks Consensus Estimate by 19.6%. Revenues of $790 million missed the Zacks Consensus Estimate by 0.35%.
Globus Medical has an estimated long-term earnings growth rate of 12.4%. GMED’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 27.88%.
View the Zacks #1 Rank List
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SOLV's Q3 Earnings: Can Growth Momentum Offset ERP-Related Headwinds?
Key Takeaways
Solventum Corporation (SOLV - Free Report) is scheduled to report third-quarter 2026 results on Nov. 5, after market close. The quarterly results are likely to reflect continued growth across MedSurg and Dental, supported by strong commercial execution, product innovation and increasing adoption of key growth drivers. However, the reversal of Q2’s ERP-related advance orders, ongoing implementation challenges and tariff pressures are expected to have weighed on reported growth and margins.
Investors will closely monitor organic sales growth, ERP-related order normalization, margin trends and Acera’s growth momentum. Management’s commentary on the HIS separation, completion of the 3M separation and progress toward its long-term growth and profitability targets will also be key.
Over the past three-month period, SOLV shares declined 7.7%, underperforming the Zacks Medical Services industry and the S&P 500 Index, which advanced 10% and declined 1.9%, respectively.
Image Source: Zacks Investment Research
SOLV’s Earnings Surprise History
SOLV beat on earnings in all the trailing four quarters, delivering an average surprise of 13.18%.
Image Source: Zacks Investment Research
SOLV’s Q3 Consensus Estimate
The Zacks Consensus Estimate for third-quarter earnings is pinned at $1.38 per share, indicating a decline of 8%. The earnings estimate has remained unchanged over the past seven days. The consensus estimate for revenues is pinned at $1.97 billion, suggesting 6% year-over-year decline.
Quarterly Drivers
Strong MedSurg and Dental Momentum: Solventum’s MedSurg and Dental businesses are expected to have remained key growth drivers, supported by improving commercial execution, product innovation and increasing adoption of differentiated solutions. Acera’s strong momentum, evident from the second-quarter sales growth of 48%, and continued demand for advanced wound care and dental products are likely to have supported underlying performance in the third quarter.
Innovation and Growth Driver Adoption: Increasing penetration of higher-value solutions across IV site management, advanced wound care and dental aesthetics is likely to have supported sales growth. Recent product launches, including V.A.C. Peel and Place and new Attest sterilization products, along with Acera’s differentiated Restrata technology, are likely to have contributed to customer conversions and revenue momentum.
Challenges
ERP-Related Order Reversal: The reversal of approximately $125 million in ERP-related advance orders recorded in the second quarter is expected to have weighed on third-quarter reported sales. Management indicated that this reversal could result in a 3-4% decline in sales growth, making inventory replenishment and the successful execution of the final ERP cutover critical to limiting further disruption.
Tariff and Inflationary Pressures: Margin performance is likely to remain under pressure from tariffs, inflation and ongoing transformation-related costs. Second-quarter gross margin, excluding the $100 million tariff refund, declined 40 basis points year over year, reflecting tariff and inflation headwinds. The absence of a similar tariff refund benefit in the third quarter could also weigh on year-over-year earnings comparisons.
Solventum Corporation Price and EPS Surprise
Solventum Corporation price-eps-surprise | Solventum Corporation Quote
What Our Model Unveils for Solventum Stock
Our proven model predicts an earnings beat for SOLV this earnings season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is exactly the case here, as you can see below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +10.15%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: SOLV has a Zacks Rank #3 at present.
Other Stocks to Consider
Some other top-ranked stocks worth considering from the broader medical space are Glaukos (GKOS - Free Report) , Edward Lifesciences (EW - Free Report) and Globus Medical (GMED - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaukos reported second-quarter 2026 earnings per share (EPS) of 14 cents, which beat the Zacks Consensus Estimate by 50.00%. Revenues of $186 million surpassed the Zacks Consensus Estimate by 24.1%.
Glaukos has an estimated earnings growth rate of 268.8% for 2027. GKOS’ earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 25.87%.
Edward Lifesciences reported second-quarter 2026 adjusted EPS of 78 cents, which beat the Zacks Consensus Estimate by 6.85%. Revenues of $1.74 billion surpassed the Zacks Consensus Estimate by 2.45%.
Edward Lifesciences has an estimated long-term earnings growth rate of 12.7%. EW’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 4.49%.
Globus Medical reported a second-quarter fiscal 2026 adjusted EPS of $1.34, which beat the Zacks Consensus Estimate by 19.6%. Revenues of $790 million missed the Zacks Consensus Estimate by 0.35%.
Globus Medical has an estimated long-term earnings growth rate of 12.4%. GMED’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 27.88%.