MASIMO CORP — Call Transcript 2026

Good afternoon, everyone. How's everyone doing? Good? Good. Welcome to the 44th Annual J.P. Morgan Healthcare Conference. My name is Cliff Zhang, an associate on the Healthcare Investment Banking team. Our next presenting company is Masimo. And speaking on behalf of the company, we're pleased to have CEO Katie Szyman. Give it up for Katie. All right. Thank you. Thanks, Cliff. Well, good afternoon, everyone, and thank you so much for your interest in Masimo. And thank you, actually, for staying all the way till Wednesday afternoon at the conference. I'm sure everyone's had at least 50 meetings by now. So great to see you all. And thank you. I'm going to start to share a little bit about Masimo. It's a quick safe harbor statement review. So for those of you who don't know as much about Masimo, Masimo is the global leader in patient monitoring. And there's a couple of highlights that I want to point out to you. One, we're a global company serving over 200 million patients per year in 150+ countries. So that's really why all of us get up every day and come to do our job, to really provide monitoring for these 200 million patients. We have over $1.5 billion in revenue and 350+ engineers strong worldwide. Our retention rate for our engineers is some of the best in the industry. We have 2.6 million units in our installed base worldwide also. And we have a very resilient supply chain as we've gone through all the ups and downs of COVID, et cetera. But some of the key kind of components of the success of our business is that we have a leading monitoring portfolio, and we have 80+% recurring revenue, and we actually have a 99%+ renewal rate. So we just did a pre-release of some of our revenues and our earnings for Q4. We had a very strong Q4. We actually had growth of 9+% in the year and 11+% in the quarter. We had really strong margin expansion on a comparable basis this past year. We expanded our margin by 500 basis points, and we had significant EPS growth this year of over 30%. So really happy that as we started out this year, we provided guidance, and we actually met or exceeded guidance in both revenue and earnings. And we anticipate coming in on the high end of our guidance as we close this year. So let me just take a moment and talk a little bit about our long-range plan. We just had our first investor day in many years here in the first week of December, and we shared our long-range guidance with everyone. So what we anticipate growing is 7%-10% over the next three years by 2028. And we see ourselves achieving a 30% operating margin with approaching an $8 EPS. So why do we believe that? One is that we've assembled a world-class team focused on execution. We have narrowed and focused our growth strategy on our core med tech markets. We have refocused our innovation to launch products in our med tech markets, and we really have market-leading EPS and cash flow that you can see from all of these numbers, and so as we go close out 2025, we did everything that we said we were going to do in 2025 with lots of surprises, tariffs, a cyber attack, really lots of things that happened, but we still delivered on our commitments, and we have tons of momentum with our leadership team as we enter 2026 and beyond, so you might say, "Okay, how are you going to achieve this?" so really, it comes down to what we call our Masimo Growth Algorithm or Masimo Growth Pillars. So it's really kind of in four key components that drive the 7%-10% growth. So U.S. pulse ox growth is about 40% of that growth, international is about 20%, and growing in advanced monitoring is about a third of the growth, and then finally, as we launch new products, we will see new product introductions driving that last point of growth for us, and we do it really with these five key strategies, so elevating commercial excellence, accelerating pulse ox growth in the U.S., increasing international pulse ox growth, and then expanding patient monitoring in the advanced monitoring categories, and then finally, executing our new product launches, so as we look across our market opportunities and how this translates into kind of the straight math, we really have a long runway for growth. We have large and growing markets, and we really see ourselves having opportunities to gain share and grow with these markets, so first, I'll talk about the U.S. pulse ox market. It's about a $1.5 billion market, growing in that 3%-4% range. And we estimate that we have approximately 55% market share in that market. Now, over the last five years, we've seen ourselves growing 1-2 points of market share per year, really growing at twice that market growth rate in the U.S.. Outside the U.S., we have a relatively lower market share, so about 35% market share. It's about an $800 million market, and it's growing on a faster basis. So it grows in that 6%-8% range. And then on advanced monitoring, we compete in a very small way in terms of having only 10%-15% market share in these advanced monitoring markets. But they are very large, and they're growing on a larger basis for us in that 5%-9% annual growth rate. And so we see ourselves being able to achieve double-digit growth in that category of advanced monitoring. And then last but not least, we have a true market expansion opportunity in what we would call continuous monitoring. I like to call it curb-to-curb monitoring because we fundamentally believe that every patient, from the moment they get dropped off at the curb of the hospital until the moment they leave the curb of the hospital to go home, they should be continuously monitored for patient safety. And actually, today, as many of you know, when you get dropped off at the hospital, you will be monitored when you're in the OR and the ICU. But as soon as you get out of those protected environments, you're actually mostly intermittently monitored every 4hours-8 hours. And we believe, I mean, how many people in this room probably have an Oura Ring on that didn't have one last year, right? Probably at least 20% of the people. I know I got one for Christmas. I have not figured out how to put it on yet. I'm going to do that after JPMorgan. But anyway, I think all of us have noticed that whether it's through your watches or through your rings, that you're starting to do self-monitoring. So why is it that we don't believe that a patient, when they're in the hospital, should be monitored all the time when they're arguably there because they're sick or they have some reason to be there? And so we believe that that can happen. And we believe that that opportunity is about a $2 billion total addressable market if all patients were monitored all the time, and that we should be the ones that actually lead when that comes to be. So we are constantly trying to find wearable solutions and things that we can do to try to help make that easy for hospitals. We have some new studies that have recently come out to show that when you monitor patients all the time at Dartmouth, they studied this over 10 years. If you monitor patients 100% of the time, not only does it save patient lives, it actually also saves cost for the hospital because it prevents patients from being sent back up and down to the ICU, which is very expensive for a hospital when they're in a DRG system. And so our long-range plan does not anticipate a lot of continuous monitoring because we need laws to change, we need that better technology, and we need hospitals across the board to start to believe that it will save them money. And so what we plan to do is to expand into a multi-center study that is going to prove not just at Dartmouth, but across a multi-center environment, you would actually be able to see that continuous monitoring saves lives and saves hospital costs. So people often ask me, like, "Well, how are you going to continue to gain 1-2 points of market share when you already have 55% market share today? Is that even possible?" So I came from a company in my last job. I worked in critical care monitoring for about 10 years. And when I started, we had about 60% market share. And the strategy at the time was, like, maintain market share. And we changed the strategy and said, "No, we want to grow market share." And when I left, we had over 85% market share. And so I do believe it's possible, but I think it's a mindset, and it's something where you've really got to drive the organization and really believe that if your technology is the best for patients, with that passion, you can actually make those conversions happen. So the way that we do it is really with our winning portfolio. We are focused on elevating our commercial and marketing strategies globally. We have an expansive installed base. And what that means is that when you have hospitals that already have your sockets, they're able to actually expand and grow your share. And then in our own customers, we have a 98% and truly a 99%+ renewal rate. So we really don't lose our existing customers, and it's really about how do we expand competitive accounts. So just a very quick snapshot for you. We not only have the best technology in SET pulse oximetry because we are the best in class in terms of motion detection and accuracy, and also around skin pigmentation. Recently, there were a lot of questions that were coming out around, "Can pulse oximeters actually accurately detect the pulse oximetry levels for patients with darker skin tones?", and we have just come out with a study in the last quarter that shows definitively that Masimo can accurately monitor patients of all skin tones and that we are the best in the industry at doing that, but then you see we have products in all kinds of advanced monitoring categories, including hemodynamics, CO-oximetry, which is our Rainbow product lines, capnography, and brain monitoring as categories, so we're either in the number one or number two market share position in all of these categories. And our goal is really to say, "If we're the leader in SET pulse oximetry, how do we get our market share to be the same when we have equivalent or better technologies in all of the other advanced monitoring categories?" And so we're doing that by innovation. And you see that we have new product launches coming in virtually every single category over the next couple of years. The other thing that we're doing in the time since I have joined Masimo this past year is really try to enhance our marketing and our commercial capabilities. So we added a Chief Commercial Officer. We've added a Chief Marketing and Strategy Officer. And then we also added a leader focused entirely on growing our business in the Japan and Asia-Pacific region. Dr. Kian Wang, who joined us, is an expert in that region, and he spends half his time in Japan and half his time in California, making sure that we have the right products for the region and that we're able to adequately grow there. For most companies, Japan will be their number two country in terms of size. At Masimo, it's number 10 for us. So we have a lot of opportunity to grow just by growing more in that Japan and Asia-Pacific region. The other thing that really makes us strong is that at Masimo, we have that 2.6 million boards that have been shipped over the last 10 years. And so that really represents for us what is our installed base. We have over 90 partnerships with different companies that will take our boards and actually attach them to their devices so they can use them for pulse ox and use our disposables for pulse ox monitoring. In particular, we actually this past year re-signed our agreement with Philips or expanded our agreement with Philips, focused on innovation. Whereas we're coming out with more advanced algorithms, we are partnering with Philips to get those algorithms onto their monitors as quickly as possible through our partnership. We're really excited and happy with the progress that we've been making with Philips. We also have partnerships with GE Healthcare and Nihon Kohden. Specifically, we're focused on expanding our partnership there in the Japan market as we invest more in that market for growth. Why does Masimo pulse ox actually represent a triple win? I've mentioned this a little bit earlier, but basically, we save lives, we save time, and we save money for the hospitals as they use our technologies because we're the highest in accuracy, and you see that our pulse oximetry is used at all of the top 10 U.S. hospitals in terms of the academic centers and institutions, so we're very clearly the technology leader, so let me share with you a little bit more about what we're going to do to continue to advance our leadership through innovation, so we call this the three waves of growth, so wave one, and it's easy for me to remember because it's EAI, so since AI is so popular, so we're elevating commercial excellence, first of all, in the first wave, and I'll talk more about what that means. We're accelerating intelligent monitoring in that second wave. And then we're innovating and launching wearables more significantly in the third wave as we look over this time period. So in the first wave, we're starting to take some of our algorithms that have been developed over the last three to five years that some were developed for the consumer space, and we're redeploying those algorithms into the hospital. So the first one is what we call the SedLine, which is a smarter algorithm for our brain monitoring portfolio. The second one is the SedLine for opioid-induced respiratory depression, and I'll talk a little bit more about that. And then in terms of future algorithm categories, you see that we have AFib detection, predictive respiratory depression, oxygen delivery, sepsis, autoregulation, and seizure detection as algorithms in our pipeline. And one of the core technologies that started Masimo was around signal detection and signal processing and truly algorithm development to get the most accuracy. And so you see us really continuing to play that forward as we attack new disease states and come up with new algorithms for improving patient care. And then on the monitor side, this year, we'll be going to a full market launch of our product called Radius VSM. And that's essentially kind of a first-generation wearable technology that's worn on the patient's arm. And it has a non-invasive blood pressure cuff. It has continuous pulse ox monitoring, and it has the ability to do EKG monitoring of a patient while they're in their own hospital room, whether it's in the med-surg floors or the floors that are typically not monitored. This is a fantastic product that we've been working on for the last several years. This year, we kept it in pilot mode so we could fix some of the feedback that we were getting from our pilot accounts, the top five across the country, and now we're going to a full launch mode. The other thing I wanted to highlight for you is our next-gen monitors, and so we have a global installed base of about 100,000 monitors. About 30% of those monitors are in the OR and the ICU in the high acuity environment, and about 70% of those monitors are more your intermittent vital signs monitors that are used for spot checking patients on the floors, and so we have not actually launched a brand new monitoring platform in over 10 years. And so the goal that we have is to come out with our next-generation high and low acuity monitor. It will come out by the end of this year. Our next-gen Root vital signs monitor will come out by the end of 2027. That offers us an opportunity to actually begin to sell a higher quality capital or kind of brand new platform with AI algorithms on it, larger screens, and then based on all the feedback that we've gotten on our Root platforms over the last 10 years. We are very excited about that opportunity because if you imagine 100,000x a price point, even if you imagine the price point to be $5,000-$10,000, you can imagine that is a really big opportunity for us to sell capital into our installed base. Then just one last comment before I move on about wearables that we really have an opportunity with wearables. We already have the W1 Watch, which has been cleared by the FDA. We also have a device called Radius PPG. We have probably like five to 10 different wearable options. And as an organization, we're really putting together in detail our wearable strategy, and then we're going to be launching it into that opportunity of continuous monitoring across the hospital, trying to get that best portfolio that's going to work with hospital workflows and actually be the best for patients. So a lot of that is not entirely baked in because it's kind of our 2028 and plus, so it's kind of beyond the long-range plan. But we see that as a tremendous opportunity. So I'll just spend a few minutes quickly doing a deep dive on the smart sensor family that we'll be launching. So the first one is the opioid-induced respiratory depression. And to give you a little bit of background on that algorithm, we have worked on it for about five years as an organization. It took us about the first three years to gather data on what happens to patients when they have an opioid-induced very rapid respiratory depression event. So if you have opioid, if you're taking a lot of opioids, you can actually have a sudden crash where you're not breathing, and it's very dangerous, and patients can actually die. So we developed that algorithm in both the home and the hospital environment. We then submitted that algorithm to the FDA, and it was a de novo, first to the world submission, and it took us 18 months to get the algorithm cleared. So what we're doing now is saying we're going to create a smart sensor that is able to unlock that algorithm in the software of our monitors inside the hospital. And we've already put that submission into the FDA here at the end of December. So we anticipate getting clearance of that for the first half of this year, and then we'll be launching in the second half of 2026. On atrial fibrillation, similar story. We've been working for about three years on gathering the clinical data to show that we can detect AFib with just a pulse ox sensor. And I know many people will have watches and things that are looking at AFib for themselves at home. So this is really a very highly accurate way to detect that something's going on with the patient's heart rhythms, which would allow the hospitals and the nurses to immediately react and be able to escalate up those patients' care to telemetry, to interventions that would actually get them out of atrial fibrillation while they're in the hospital in recovery. And then the future would be that we would develop algorithms to predict a respiratory depression event using our same database. And so once you gather the data for three years, it's easier then to iterate and expand those algorithms. So just to close out on this point, the key takeaways are that we have given guidance in the long-range plan for 7%-10%. We have a new team. We have a new product pipeline. We are very focused on the hospital environment, and we have a lot of momentum because we've delivered on 2025, and we have tons of momentum as we go into 2026, and we're really excited to continue to help and impact the lives of 200 million more patients per year in the future, so thank you all very much for listening, and we will open it up for questions. Thanks. Thank you, Katie. So now we'll transition to Q&A, and if you have a question, please raise your hand. I believe mics will be coming around the room. So we also have an online audience, and here's a question that just came in. So, Katie, AI has been an integral part of the zeitgeist. What plan does Masimo have for AI and integrating or incorporating the technology into your portfolio? And then maybe a follow-up would be, why do you think Masimo's use of AI would be differentiated from your competition? Yeah, so thanks. I mean, a lot of what I just shared was kind of our AI pipeline. I think the reason why Masimo will be differentiated from the competition is that we have an amazing team of 30 engineers in our algorithm department. One of them actually is one of the founding engineers who's been; I think he was employee number 12. He's been with us for 33 years, and the algorithm development was really the core of Masimo technology. In those days, they just called it math, and then now we call it artificial intelligence, and so I think as you see that evolution, we already have a strength in it, and I think that we will continue with all the algorithms that I showed to find ways because AI only matters if it's really going to impact patient care and make it better. You don't just do AI just so you can say that you're doing AI, and so I think we've already used machine learning to develop a lot of our algorithms and that we will continue to do that, staying patient-focused to solve true clinical problems, and I think that's why we'll always win in the future. Thank you. Give a second for the audience. Another question came in from the online audience about maybe your growth strategy that you presented. So that involved U.S. pulse ox, international pulse ox, expanding market share for your advanced monitoring product portfolio, and launching new innovative products. Which of these components are you most excited about and investors should be focused on? Is that you, Micah? Why don't you go first, and then I'll... Let me go. Yeah, I think looking at the, we've got a lot of great innovation coming in the next three to four years. And if I look at what I'm probably most excited about is some of the AI algorithms. We did a lot of great work on some of these algorithms that were being used outside the hospital, and we were bringing those back in for indications in the hospital. And if you look at whether it's opioid-induced respiratory depression or the AFib detection, I think those are exciting because that's going to drive significant value to customers, and especially for those patients who are coming through the hospital who are dealing with AFib or, as Katie mentioned earlier on one of the slides, it showed that up to 46% of patients who are post-surgery are taking opioids. And to be able to save lives with that kind of technology is incredible. And I think we can recognize the value for Masimo as we demonstrate that value to customers. And then I think Root Squared, just the capabilities of that connectivity platform, being able to refresh the install base. We do have a large install base out there that's going to refresh over the coming years as we launch that. And it's a very expandable platform. It can handle a lot of different connectivity to a lot of devices in the hospital. And it's also going to be a great expandable platform for our wearables as we start to launch those in the coming years as well. Thank you, Micah. I think what I'm excited about is just the same, but as we launch these new algorithms, I'm excited to see the reaction of doctors and clinicians. And so we've had two advisory boards already where we showed them kind of the list of all the R&D projects and said, "What would you?" We had them use Monopoly money and vote on what they would prioritize first. And AFib detection was actually always voted as number one in each of the environments. And then the second was around the next-gen Root monitors and the ability to have a full screen because the existing Root monitors were super innovative when they first came out. But now, as we've added more and more technology, it's a very narrow screen, and so people want kind of more real estate to be able to see more of the parameters at the same time. Awesome. Thank you. Another question just came in. So you mentioned currently unmonitored patients in low acuity settings is an untapped market that presents a compelling growth opportunity. Can you please elaborate on what you mean by untapped and why this provides upside opportunity for Masimo? Yeah, I think the reason why it's untapped is I think that really for hospital and hospital CEOs, people kind of just do the standard of care, and right now, the standard of care is to monitor a patient intermittently every four or eight hours, depending on what the doctor has written in the prescription for that patient, and I think that's really untapped because where we see hospitals have a lot of passion to go with continuous monitoring is when they have a seminal event where a patient may die accidentally, and that causes the hospital to say, "Wow, we should have monitored this patient, and we should monitor all patients all the time," so then we have very motivated hospitals and doctors that will work on it with us, but that shouldn't be the way it should be. It should be that the motivation should be preventive patient safety where you monitor all patients all the time while they're in the hospital. You find ways to do that in a way that's much less expensive and actually saves the hospital system's money. I think historically, the reason why people never did it is because it was too expensive. I mean, the technology was not available, and now the technology is ubiquitous for all of us to be able to monitor ourselves, so we should be able to do the same for patients in the hospital too. Thank you. Another question would be, so you're nearing the anniversary of your tenure as CEO. Congratulations, first off. Thank you. What are you most excited about going forward? Yeah, I think that Masimo has gone through a lot of transition in the last several years, and so what I'm most excited about is I feel like 2025 for us was a year of stabilization that I've been there now for a whole year. We've made some really great improvements as we've gone through the year, and we delivered on our commitments, and so I feel like 2025 was stabilization and execution and forming the strategy. And 2026 is really building momentum, and we're starting to see a lot of momentum with people understanding what we need to do, people getting excited about the impact it's going to have on patient care, and then just really working together on momentum to deliver next year. So for that reason, we're really, really excited. And I feel like for me, looking back, my husband put in our holiday card that he sent out to everyone we know that Katie took a new job, and we've never seen her since. So I'm personally looking forward to maybe seeing my family a little bit more next year. I don't know if that's possible because people say the second year is always quite intense too. But we have a lot to do as a team, and I'm really excited to be a part of this team to make it happen. Masimo is a great company, and we have great potential. Let's see. So. I don't know, Micah, what do you think? As far as the. Yeah, just things you're excited about in 2026. Yeah, I mean, I'm excited. I think we've, like you said, last year was a stabilization year for the company. I think a lot of change we went through, and I think the team is re-energized again. And I think we've got an exciting pipeline of innovation that we're going to, all these new products that we're going to launch. And I think the team's excited about delivering those to our customers and to patients. And a lot of that's going to start to play out in 2026, and I think we're set up for success. You also just presented ambitions to continue strong revenue growth, operating margin improvement, EPS growth in 2026 and beyond. Can you elaborate how Masimo's financial performance in 2025, and together with executing on the strategy and the plan that you just presented, how does that set up Masimo for an even better 2026 and beyond? Yeah, I can start. Go ahead, Micah. Micah, why don't you start? So as we came into 2025, we had a few curveballs. Everybody was facing new tariffs. When we initiated guidance coming into last year, we set that this time last year. And as the year played out, tariffs came on, and we still delivered strong earnings, margin improvement, strong revenue growth last year. And our earnings exceeded not only the initial guidance, but also with the tariff headwinds, we exceeded that guidance, and we did not know about that coming into the year. And we navigated through second quarter, which was another curveball, which was we had a cyber attack on the company. And being able to still recover from that, we've got a very nimble team, and they worked effortlessly to just get product out to customers and recover from that event. To be able to navigate all that and still deliver on our commitments this past year, I'm really proud of the team, and that's what makes us excited about 2026 and moving forward. I mean, we've got a strong team, a very capable team of launching these products, executing. We finished the year strong last year, as you saw our results that Katie mentioned earlier. Strong contracting to finish the year, which sets us up with great momentum coming into 2026, and we're on the right track. Yeah, and I guess my comment would be at the end of 2024, before I joined, Micah and the team kind of led an effort to really refocus back on the core medtech business, and that involved restructuring to eliminate some of our roles related to consumer, and so what I've actually been so impressed with as we've gone through this year is that we have ample opportunity to invest in R&D with the 8% levels that we have. We have a strong and committed R&D organization. We've really seen turnover kind of come down dramatically over the last couple of years, and we really see a lot of momentum in the organization. And so now, after that kind of one-time reset where I was concerned maybe coming in, do we have enough spending, I can confidently say that we have enough to invest, that as we're doing these next-gen products, they're more predictable and they're technologies that we know how to do, and that now it's going to be about natural leverage, which is that as we grow, it will continue to drive more profitability. We don't have to do major change. We can actually just grow with this momentum and deliver those results. And high profitability, high cash flow, we've been able to do share buybacks. We really have a lot of opportunity just with the natural leverage of the company. So we're confident in the future. Thank you both. Any additional questions from the audience? I can't see anything. Oh, this gentleman over there? I see a hand. First of all, congratulations on your one-year anniversary. My question would be, as you mentioned yourself, after going out of the operating room and the ICU, the patient basically stops being monitored. And my question would be, how do you see the telehealth opportunity playing out for Masimo? Would it be a direct-to-consumer, which I don't think would be really the case given the Sound United disposal, or would it be through the physician, the hospitals? Thank you. Yeah, thank you. That's a great question. So I think telehealth is the way that we're viewing it today is that it's really trying to focus on how do we enable hospitals to provide telehealth for their patients. So a lot of hospitals are trying to build programs. Even centralized governments are trying to build programs to create a telehealth setup. So what we're doing is actually selling telehealth solutions to the hospital system, and then they are providing that care into the home for those patients. So we're essentially enabling technology for telehealth with our wearable solutions. So we do see an opportunity for telehealth, and we have had a major pilot in one of the countries outside the United States this past year, and we actually have a team meeting next week to say, how do we take this global? What is the best setup? How do we actually enable hospitals to provide telehealth to their patients? So it's not like we're not doing it, but we don't plan to be the ones that sell direct-to-consumer because that's just not what we're good at. We're going to be selling and enabling hospitals and clinicians to do telehealth themselves. Thanks. Any additional questions? Any final remarks? If there are none, that will conclude today's session. Thank you all for coming. Thank you. Thank you.

Speaker 4: Good afternoon, everyone. How's everyone doing? Good afternoon, everyone. good afternoon everyone How's everyone doing? how's everyone doing Good? Good. Welcome to the 44th Annual J.P. Morgan Healthcare Conference. My name is Cliff Zhang, an associate on the Healthcare Investment Banking team. Our next presenting company is Masimo. And speaking on behalf of the company, we're pleased to have CEO Katie Szyman. Give it up for Katie. Good? good Good. good Welcome to the 44th Annual J.P. welcome to the 44th annual j.p Morgan Healthcare Conference. morgan healthcare conference My name is Cliff Zhang, an associate on the Healthcare Investment Banking team. my name is cliff zhang an associate on the healthcare investment banking team Our next presenting company is Masimo. our next presenting company is masimo And speaking on behalf of the company, we're pleased to have CEO Katie Szyman. and speaking on behalf of the company we're pleased to have ceo katie szyman Give it up for Katie. give it up for katie

Speaker 3: All right. Thank you. Thanks, Cliff. Well, good afternoon, everyone, and thank you so much for your interest in Masimo. And thank you, actually, for staying all the way till Wednesday afternoon at the conference. I'm sure everyone's had at least 50 meetings by now. So great to see you all. And thank you. I'm going to start to share a little bit about Masimo. It's a quick safe harbor statement review. So for those of you who don't know as much about Masimo, Masimo is the global leader in patient monitoring. And there's a couple of highlights that I want to point out to you. One, we're a global company serving over 200 million patients per year in 150+ countries. So that's really why all of us get up every day and come to do our job, to really provide monitoring for these 200 million patients. All right. all right Thank you. thank you Thanks, Cliff. thanks cliff Well, good afternoon, everyone, and thank you so much for your interest in Masimo. well good afternoon everyone and thank you so much for your interest in masimo And thank you, actually, for staying all the way till Wednesday afternoon at the conference. and thank you actually for staying all the way till wednesday afternoon at the conference I'm sure everyone's had at least 50 meetings by now. i'm sure everyone's had at least 50 meetings by now So great to see you all. so great to see you all And thank you. and thank you I'm going to start to share a little bit about Masimo. i'm going to start to share a little bit about masimo It's a quick safe harbor statement review. it's a quick safe harbor statement review So for those of you who don't know as much about Masimo, Masimo is the global leader in patient monitoring. so for those of you who don't know as much about masimo masimo is the global leader in patient monitoring And there's a couple of highlights that I want to point out to you. and there's a couple of highlights that i want to point out to you One, we're a global company serving over 200 million patients per year in 150+ countries. one we're a global company serving over 200 million patients per year in 150+ countries So that's really why all of us get up every day and come to do our job, to really provide monitoring for these 200 million patients. so that's really why all of us get up every day and come to do our job to really provide monitoring for these 200 million patients We have over $1.5 billion in revenue and 350+ engineers strong worldwide. Our retention rate for our engineers is some of the best in the industry. We have 2.6 million units in our installed base worldwide also. And we have a very resilient supply chain as we've gone through all the ups and downs of COVID, et cetera. But some of the key kind of components of the success of our business is that we have a leading monitoring portfolio, and we have 80+% recurring revenue, and we actually have a 99%+ renewal rate. So we just did a pre-release of some of our revenues and our earnings for Q4. We had a very strong Q4. We actually had growth of 9+% in the year and 11+% in the quarter. We had really strong margin expansion on a comparable basis this past year. We have over $1.5 billion in revenue and 350+ engineers strong worldwide. we have over $1.5 billion in revenue and 350+ engineers strong worldwide Our retention rate for our engineers is some of the best in the industry. our retention rate for our engineers is some of the best in the industry We have 2.6 million units in our installed base worldwide also. we have 2.6 million units in our installed base worldwide also And we have a very resilient supply chain as we've gone through all the ups and downs of COVID, et cetera. and we have a very resilient supply chain as we've gone through all the ups and downs of covid et cetera But some of the key kind of components of the success of our business is that we have a leading monitoring portfolio, and we have 80+% recurring revenue, and we actually have a 99%+ renewal rate. but some of the key kind of components of the success of our business is that we have a leading monitoring portfolio and we have 80+% recurring revenue and we actually have a 99%+ renewal rate So we just did a pre-release of some of our revenues and our earnings for Q4. so we just did a pre-release of some of our revenues and our earnings for q4 We had a very strong Q4. we had a very strong q4 We actually had growth of 9+% in the year and 11+% in the quarter. we actually had growth of 9+% in the year and 11+% in the quarter We had really strong margin expansion on a comparable basis this past year. we had really strong margin expansion on a comparable basis this past year We expanded our margin by 500 basis points, and we had significant EPS growth this year of over 30%. So really happy that as we started out this year, we provided guidance, and we actually met or exceeded guidance in both revenue and earnings. And we anticipate coming in on the high end of our guidance as we close this year. So let me just take a moment and talk a little bit about our long-range plan. We just had our first investor day in many years here in the first week of December, and we shared our long-range guidance with everyone. So what we anticipate growing is 7%-10% over the next three years by 2028. And we see ourselves achieving a 30% operating margin with approaching an $8 EPS. So why do we believe that? One is that we've assembled a world-class team focused on execution. We expanded our margin by 500 basis points, and we had significant EPS growth this year of over 30%. we expanded our margin by 500 basis points and we had significant eps growth this year of over 30% So really happy that as we started out this year, we provided guidance, and we actually met or exceeded guidance in both revenue and earnings. so really happy that as we started out this year we provided guidance and we actually met or exceeded guidance in both revenue and earnings And we anticipate coming in on the high end of our guidance as we close this year. and we anticipate coming in on the high end of our guidance as we close this year So let me just take a moment and talk a little bit about our long-range plan. so let me just take a moment and talk a little bit about our long-range plan We just had our first investor day in many years here in the first week of December, and we shared our long-range guidance with everyone. we just had our first investor day in many years here in the first week of december and we shared our long-range guidance with everyone So what we anticipate growing is 7%-10% over the next three years by 2028. so what we anticipate growing is 7%-10% over the next three years by 2028 And we see ourselves achieving a 30% operating margin with approaching an $8 EPS. and we see ourselves achieving a 30% operating margin with approaching an $8 eps So why do we believe that? so why do we believe that One is that we've assembled a world-class team focused on execution. one is that we've assembled a world-class team focused on execution We have narrowed and focused our growth strategy on our core med tech markets. We have refocused our innovation to launch products in our med tech markets, and we really have market-leading EPS and cash flow that you can see from all of these numbers, and so as we go close out 2025, we did everything that we said we were going to do in 2025 with lots of surprises, tariffs, a cyber attack, really lots of things that happened, but we still delivered on our commitments, and we have tons of momentum with our leadership team as we enter 2026 and beyond, so you might say, "Okay, how are you going to achieve this?" so really, it comes down to what we call our Masimo Growth Algorithm or Masimo Growth Pillars. So it's really kind of in four key components that drive the 7%-10% growth. We have narrowed and focused our growth strategy on our core med tech markets. we have narrowed and focused our growth strategy on our core med tech markets We have refocused our innovation to launch products in our med tech markets, and we really have market-leading EPS and cash flow that you can see from all of these numbers, and so as we go close out 2025, we did everything that we said we were going to do in 2025 with lots of surprises, tariffs, a cyber attack, really lots of things that happened, but we still delivered on our commitments, and we have tons of momentum with our leadership team as we enter 2026 and beyond, so you might say, "Okay, how are you going to achieve this?" so really, it comes down to what we call our Masimo Growth Algorithm or Masimo Growth Pillars. we have refocused our innovation to launch products in our med tech markets and we really have market-leading eps and cash flow that you can see from all of these numbers and so as we go close out 2025 we did everything that we said we were going to do in 2025 with lots of surprises tariffs a cyber attack really lots of things that happened but we still delivered on our commitments and we have tons of momentum with our leadership team as we enter 2026 and beyond so you might say "okay how are you going to achieve this?" so really it comes down to what we call our masimo growth algorithm or masimo growth pillars So it's really kind of in four key components that drive the 7%-10% growth. so it's really kind of in four key components that drive the 7%-10% growth So U.S. pulse ox growth is about 40% of that growth, international is about 20%, and growing in advanced monitoring is about a third of the growth, and then finally, as we launch new products, we will see new product introductions driving that last point of growth for us, and we do it really with these five key strategies, so elevating commercial excellence, accelerating pulse ox growth in the U.S., increasing international pulse ox growth, and then expanding patient monitoring in the advanced monitoring categories, and then finally, executing our new product launches, so as we look across our market opportunities and how this translates into kind of the straight math, we really have a long runway for growth. We have large and growing markets, and we really see ourselves having opportunities to gain share and grow with these markets, so first, I'll talk about the U.S. pulse ox market. So U.S. pulse ox growth is about 40% of that growth, international is about 20%, and growing in advanced monitoring is about a third of the growth, and then finally, as we launch new products, we will see new product introductions driving that last point of growth for us, and we do it really with these five key strategies, so elevating commercial excellence, accelerating pulse ox growth in the U.S., increasing international pulse ox growth, and then expanding patient monitoring in the advanced monitoring categories, and then finally, executing our new product launches, so as we look across our market opportunities and how this translates into kind of the straight math, we really have a long runway for growth. so u.s pulse ox growth is about 40% of that growth international is about 20% and growing in advanced monitoring is about a third of the growth and then finally as we launch new products we will see new product introductions driving that last point of growth for us and we do it really with these five key strategies so elevating commercial excellence accelerating pulse ox growth in the u.s increasing international pulse ox growth and then expanding patient monitoring in the advanced monitoring categories and then finally executing our new product launches so as we look across our market opportunities and how this translates into kind of the straight math we really have a long runway for growth We have large and growing markets, and we really see ourselves having opportunities to gain share and grow with these markets, so first, I'll talk about the U.S. pulse ox market. we have large and growing markets and we really see ourselves having opportunities to gain share and grow with these markets so first i'll talk about the u.s pulse ox market It's about a $1.5 billion market, growing in that 3%-4% range. And we estimate that we have approximately 55% market share in that market. Now, over the last five years, we've seen ourselves growing 1-2 points of market share per year, really growing at twice that market growth rate in the U.S.. Outside the U.S., we have a relatively lower market share, so about 35% market share. It's about an $800 million market, and it's growing on a faster basis. So it grows in that 6%-8% range. And then on advanced monitoring, we compete in a very small way in terms of having only 10%-15% market share in these advanced monitoring markets. But they are very large, and they're growing on a larger basis for us in that 5%-9% annual growth rate. And so we see ourselves being able to achieve double-digit growth in that category of advanced monitoring. It's about a $1.5 billion market, growing in that 3%-4% range. it's about a $1.5 billion market growing in that 3%-4% range And we estimate that we have approximately 55% market share in that market. and we estimate that we have approximately 55% market share in that market Now, over the last five years, we've seen ourselves growing 1-2 points of market share per year, really growing at twice that market growth rate in the U.S.. now over the last five years we've seen ourselves growing 1-2 points of market share per year really growing at twice that market growth rate in the u.s Outside the U.S., we have a relatively lower market share, so about 35% market share. outside the u.s we have a relatively lower market share so about 35% market share It's about an $800 million market, and it's growing on a faster basis. it's about an $800 million market and it's growing on a faster basis So it grows in that 6%-8% range. so it grows in that 6%-8% range And then on advanced monitoring, we compete in a very small way in terms of having only 10%-15% market share in these advanced monitoring markets. and then on advanced monitoring we compete in a very small way in terms of having only 10%-15% market share in these advanced monitoring markets But they are very large, and they're growing on a larger basis for us in that 5%-9% annual growth rate. but they are very large and they're growing on a larger basis for us in that 5%-9% annual growth rate And so we see ourselves being able to achieve double-digit growth in that category of advanced monitoring. and so we see ourselves being able to achieve double-digit growth in that category of advanced monitoring And then last but not least, we have a true market expansion opportunity in what we would call continuous monitoring. I like to call it curb-to-curb monitoring because we fundamentally believe that every patient, from the moment they get dropped off at the curb of the hospital until the moment they leave the curb of the hospital to go home, they should be continuously monitored for patient safety. And actually, today, as many of you know, when you get dropped off at the hospital, you will be monitored when you're in the OR and the ICU. But as soon as you get out of those protected environments, you're actually mostly intermittently monitored every 4hours-8 hours. And we believe, I mean, how many people in this room probably have an Oura Ring on that didn't have one last year, right? Probably at least 20% of the people. And then last but not least, we have a true market expansion opportunity in what we would call continuous monitoring. and then last but not least we have a true market expansion opportunity in what we would call continuous monitoring I like to call it curb-to-curb monitoring because we fundamentally believe that every patient, from the moment they get dropped off at the curb of the hospital until the moment they leave the curb of the hospital to go home, they should be continuously monitored for patient safety. i like to call it curb-to-curb monitoring because we fundamentally believe that every patient from the moment they get dropped off at the curb of the hospital until the moment they leave the curb of the hospital to go home they should be continuously monitored for patient safety And actually, today, as many of you know, when you get dropped off at the hospital, you will be monitored when you're in the OR and the ICU. and actually today as many of you know when you get dropped off at the hospital you will be monitored when you're in the or and the icu But as soon as you get out of those protected environments, you're actually mostly intermittently monitored every 4hours-8 hours. but as soon as you get out of those protected environments you're actually mostly intermittently monitored every 4hours-8 hours And we believe, I mean, how many people in this room probably have an Oura Ring on that didn't have one last year, right? and we believe i mean how many people in this room probably have an oura ring on that didn't have one last year right Probably at least 20% of the people. probably at least 20% of the people I know I got one for Christmas. I have not figured out how to put it on yet. I'm going to do that after JPMorgan. But anyway, I think all of us have noticed that whether it's through your watches or through your rings, that you're starting to do self-monitoring. So why is it that we don't believe that a patient, when they're in the hospital, should be monitored all the time when they're arguably there because they're sick or they have some reason to be there? And so we believe that that can happen. And we believe that that opportunity is about a $2 billion total addressable market if all patients were monitored all the time, and that we should be the ones that actually lead when that comes to be. I know I got one for Christmas. i know i got one for christmas I have not figured out how to put it on yet. i have not figured out how to put it on yet I'm going to do that after JP Morgan. i'm going to do that after jp morgan But anyway, I think all of us have noticed that whether it's through your watches or through your rings, that you're starting to do self-monitoring. but anyway i think all of us have noticed that whether it's through your watches or through your rings that you're starting to do self-monitoring So why is it that we don't believe that a patient, when they're in the hospital, should be monitored all the time when they're arguably there because they're sick or they have some reason to be there? so why is it that we don't believe that a patient when they're in the hospital should be monitored all the time when they're arguably there because they're sick or they have some reason to be there And so we believe that that can happen. and so we believe that that can happen And we believe that that opportunity is about a $2 billion total addressable market if all patients were monitored all the time, and that we should be the ones that actually lead when that comes to be. and we believe that that opportunity is about a $2 billion total addressable market if all patients were monitored all the time and that we should be the ones that actually lead when that comes to be So we are constantly trying to find wearable solutions and things that we can do to try to help make that easy for hospitals. We have some new studies that have recently come out to show that when you monitor patients all the time at Dartmouth, they studied this over 10 years. If you monitor patients 100% of the time, not only does it save patient lives, it actually also saves cost for the hospital because it prevents patients from being sent back up and down to the ICU, which is very expensive for a hospital when they're in a DRG system. And so our long-range plan does not anticipate a lot of continuous monitoring because we need laws to change, we need that better technology, and we need hospitals across the board to start to believe that it will save them money. So we are constantly trying to find wearable solutions and things that we can do to try to help make that easy for hospitals. so we are constantly trying to find wearable solutions and things that we can do to try to help make that easy for hospitals We have some new studies that have recently come out to show that when you monitor patients all the time at Dartmouth, they studied this over 10 years. we have some new studies that have recently come out to show that when you monitor patients all the time at dartmouth they studied this over 10 years If you monitor patients 100% of the time, not only does it save patient lives, it actually also saves cost for the hospital because it prevents patients from being sent back up and down to the ICU, which is very expensive for a hospital when they're in a DRG system. if you monitor patients 100% of the time not only does it save patient lives it actually also saves cost for the hospital because it prevents patients from being sent back up and down to the icu which is very expensive for a hospital when they're in a drg system And so our long-range plan does not anticipate a lot of continuous monitoring because we need laws to change, we need that better technology, and we need hospitals across the board to start to believe that it will save them money. and so our long-range plan does not anticipate a lot of continuous monitoring because we need laws to change we need that better technology and we need hospitals across the board to start to believe that it will save them money And so what we plan to do is to expand into a multi-center study that is going to prove not just at Dartmouth, but across a multi-center environment, you would actually be able to see that continuous monitoring saves lives and saves hospital costs. So people often ask me, like, "Well, how are you going to continue to gain 1-2 points of market share when you already have 55% market share today? Is that even possible?" So I came from a company in my last job. I worked in critical care monitoring for about 10 years. And when I started, we had about 60% market share. And the strategy at the time was, like, maintain market share. And we changed the strategy and said, "No, we want to grow market share." And when I left, we had over 85% market share. And so what we plan to do is to expand into a multi-center study that is going to prove not just at Dartmouth, but across a multi-center environment, you would actually be able to see that continuous monitoring saves lives and saves hospital costs. and so what we plan to do is to expand into a multi-center study that is going to prove not just at dartmouth but across a multi-center environment you would actually be able to see that continuous monitoring saves lives and saves hospital costs So people often ask me, like, "Well, how are you going to continue to gain 1-2 points of market share when you already have 55% market share today? so people often ask me like "well how are you going to continue to gain 1-2 points of market share when you already have 55% market share today Is that even possible?" So I came from a company in my last job. is that even possible?" so i came from a company in my last job I worked in critical care monitoring for about 10 years. i worked in critical care monitoring for about 10 years And when I started, we had about 60% market share. and when i started we had about 60% market share And the strategy at the time was, like, maintain market share. and the strategy at the time was like maintain market share And we changed the strategy and said, "No, we want to grow market share." And when I left, we had over 85% market share. and we changed the strategy and said "no we want to grow market share." and when i left we had over 85% market share And so I do believe it's possible, but I think it's a mindset, and it's something where you've really got to drive the organization and really believe that if your technology is the best for patients, with that passion, you can actually make those conversions happen. So the way that we do it is really with our winning portfolio. We are focused on elevating our commercial and marketing strategies globally. We have an expansive installed base. And what that means is that when you have hospitals that already have your sockets, they're able to actually expand and grow your share. And then in our own customers, we have a 98% and truly a 99%+ renewal rate. So we really don't lose our existing customers, and it's really about how do we expand competitive accounts. So just a very quick snapshot for you. And so I do believe it's possible, but I think it's a mindset, and it's something where you've really got to drive the organization and really believe that if your technology is the best for patients, with that passion, you can actually make those conversions happen. and so i do believe it's possible but i think it's a mindset and it's something where you've really got to drive the organization and really believe that if your technology is the best for patients with that passion you can actually make those conversions happen So the way that we do it is really with our winning portfolio. so the way that we do it is really with our winning portfolio We are focused on elevating our commercial and marketing strategies globally. we are focused on elevating our commercial and marketing strategies globally We have an expansive installed base. we have an expansive installed base And what that means is that when you have hospitals that already have your sockets, they're able to actually expand and grow your share. and what that means is that when you have hospitals that already have your sockets they're able to actually expand and grow your share And then in our own customers, we have a 98% and truly a 99%+ renewal rate. and then in our own customers we have a 98% and truly a 99%+ renewal rate So we really don't lose our existing customers, and it's really about how do we expand competitive accounts. so we really don't lose our existing customers and it's really about how do we expand competitive accounts So just a very quick snapshot for you. so just a very quick snapshot for you We not only have the best technology in SET pulse oximetry because we are the best in class in terms of motion detection and accuracy, and also around skin pigmentation. Recently, there were a lot of questions that were coming out around, "Can pulse oximeters actually accurately detect the pulse oximetry levels for patients with darker skin tones?", and we have just come out with a study in the last quarter that shows definitively that Masimo can accurately monitor patients of all skin tones and that we are the best in the industry at doing that, but then you see we have products in all kinds of advanced monitoring categories, including hemodynamics, CO-oximetry, which is our Rainbow product lines, capnography, and brain monitoring as categories, so we're either in the number one or number two market share position in all of these categories. We not only have the best technology in SET pulse oximetry because we are the best in class in terms of motion detection and accuracy, and also around skin pigmentation. we not only have the best technology in set pulse oximetry because we are the best in class in terms of motion detection and accuracy and also around skin pigmentation Recently, there were a lot of questions that were coming out around, "Can pulse oximeters actually accurately detect the pulse oximetry levels for patients with darker skin tones?", and we have just come out with a study in the last quarter that shows definitively that Masimo can accurately monitor patients of all skin tones and that we are the best in the industry at doing that, but then you see we have products in all kinds of advanced monitoring categories, including hemodynamics, CO-oximetry, which is our Rainbow product lines, capnography, and brain monitoring as categories, so we're either in the number one or number two market share position in all of these categories. recently there were a lot of questions that were coming out around "can pulse oximeters actually accurately detect the pulse oximetry levels for patients with darker skin tones?" and we have just come out with a study in the last quarter that shows definitively that masimo can accurately monitor patients of all skin tones and that we are the best in the industry at doing that but then you see we have products in all kinds of advanced monitoring categories including hemodynamics co-oximetry which is our rainbow product lines capnography and brain monitoring as categories so we're either in the number one or number two market share position in all of these categories And our goal is really to say, "If we're the leader in SET pulse oximetry, how do we get our market share to be the same when we have equivalent or better technologies in all of the other advanced monitoring categories?" And so we're doing that by innovation. And you see that we have new product launches coming in virtually every single category over the next couple of years. The other thing that we're doing in the time since I have joined Masimo this past year is really try to enhance our marketing and our commercial capabilities. So we added a Chief Commercial Officer. We've added a Chief Marketing and Strategy Officer. And then we also added a leader focused entirely on growing our business in the Japan and Asia-Pacific region. Dr. And our goal is really to say, "If we're the leader in SET pulse oximetry, how do we get our market share to be the same when we have equivalent or better technologies in all of the other advanced monitoring categories?" And so we're doing that by innovation. and our goal is really to say "if we're the leader in set pulse oximetry how do we get our market share to be the same when we have equivalent or better technologies in all of the other advanced monitoring categories?" and so we're doing that by innovation And you see that we have new product launches coming in virtually every single category over the next couple of years. and you see that we have new product launches coming in virtually every single category over the next couple of years The other thing that we're doing in the time since I have joined Masimo this past year is really try to enhance our marketing and our commercial capabilities. the other thing that we're doing in the time since i have joined masimo this past year is really try to enhance our marketing and our commercial capabilities So we added a Chief Commercial Officer. so we added a chief commercial officer We've added a Chief Marketing and Strategy Officer. we've added a chief marketing and strategy officer And then we also added a leader focused entirely on growing our business in the Japan and Asia-Pacific region. and then we also added a leader focused entirely on growing our business in the japan and asia-pacific region Dr. dr Kian Wang, who joined us, is an expert in that region, and he spends half his time in Japan and half his time in California, making sure that we have the right products for the region and that we're able to adequately grow there. For most companies, Japan will be their number two country in terms of size. At Masimo, it's number 10 for us. So we have a lot of opportunity to grow just by growing more in that Japan and Asia-Pacific region. The other thing that really makes us strong is that at Masimo, we have that 2.6 million boards that have been shipped over the last 10 years. And so that really represents for us what is our installed base. Kian Wang, who joined us, is an expert in that region, and he spends half his time in Japan and half his time in California, making sure that we have the right products for the region and that we're able to adequately grow there. kian wang who joined us is an expert in that region and he spends half his time in japan and half his time in california making sure that we have the right products for the region and that we're able to adequately grow there For most companies, Japan will be their number two country in terms of size. for most companies japan will be their number two country in terms of size At Masimo, it's number 10 for us. at masimo it's number 10 for us So we have a lot of opportunity to grow just by growing more in that Japan and Asia-Pacific region. so we have a lot of opportunity to grow just by growing more in that japan and asia-pacific region The other thing that really makes us strong is that at Masimo, we have that 2.6 million boards that have been shipped over the last 10 years. the other thing that really makes us strong is that at masimo we have that 2.6 million boards that have been shipped over the last 10 years And so that really represents for us what is our installed base. and so that really represents for us what is our installed base We have over 90 partnerships with different companies that will take our boards and actually attach them to their devices so they can use them for pulse ox and use our disposables for pulse ox monitoring. In particular, we actually this past year re-signed our agreement with Philips or expanded our agreement with Philips, focused on innovation. Whereas we're coming out with more advanced algorithms, we are partnering with Philips to get those algorithms onto their monitors as quickly as possible through our partnership. We're really excited and happy with the progress that we've been making with Philips. We also have partnerships with GE Healthcare and Nihon Kohden. Specifically, we're focused on expanding our partnership there in the Japan market as we invest more in that market for growth. Why does Masimo pulse ox actually represent a triple win? We have over 90 partnerships with different companies that will take our boards and actually attach them to their devices so they can use them for pulse ox and use our disposables for pulse ox monitoring. we have over 90 partnerships with different companies that will take our boards and actually attach them to their devices so they can use them for pulse ox and use our disposables for pulse ox monitoring In particular, we actually this past year re-signed our agreement with Philips or expanded our agreement with Philips, focused on innovation. in particular we actually this past year re-signed our agreement with philips or expanded our agreement with philips focused on innovation Whereas we're coming out with more advanced algorithms, we are partnering with Philips to get those algorithms onto their monitors as quickly as possible through our partnership. whereas we're coming out with more advanced algorithms we are partnering with philips to get those algorithms onto their monitors as quickly as possible through our partnership We're really excited and happy with the progress that we've been making with Philips. we're really excited and happy with the progress that we've been making with philips We also have partnerships with GE Healthcare and Nihon Kohden. we also have partnerships with ge healthcare and nihon kohden Specifically, we're focused on expanding our partnership there in the Japan market as we invest more in that market for growth. specifically we're focused on expanding our partnership there in the japan market as we invest more in that market for growth Why does Masimo pulse ox actually represent a triple win? why does masimo pulse ox actually represent a triple win I've mentioned this a little bit earlier, but basically, we save lives, we save time, and we save money for the hospitals as they use our technologies because we're the highest in accuracy, and you see that our pulse oximetry is used at all of the top 10 U.S. hospitals in terms of the academic centers and institutions, so we're very clearly the technology leader, so let me share with you a little bit more about what we're going to do to continue to advance our leadership through innovation, so we call this the three waves of growth, so wave one, and it's easy for me to remember because it's EAI, so since AI is so popular, so we're elevating commercial excellence, first of all, in the first wave, and I'll talk more about what that means. We're accelerating intelligent monitoring in that second wave. I've mentioned this a little bit earlier, but basically, we save lives, we save time, and we save money for the hospitals as they use our technologies because we're the highest in accuracy, and you see that our pulse oximetry is used at all of the top 10 U.S. hospitals in terms of the academic centers and institutions, so we're very clearly the technology leader, so let me share with you a little bit more about what we're going to do to continue to advance our leadership through innovation, so we call this the three waves of growth, so wave one, and it's easy for me to remember because it's EAI, so since AI is so popular, so we're elevating commercial excellence, first of all, in the first wave, and I'll talk more about what that means. i've mentioned this a little bit earlier but basically we save lives we save time and we save money for the hospitals as they use our technologies because we're the highest in accuracy and you see that our pulse oximetry is used at all of the top 10 u.s hospitals in terms of the academic centers and institutions so we're very clearly the technology leader so let me share with you a little bit more about what we're going to do to continue to advance our leadership through innovation so we call this the three waves of growth so wave one and it's easy for me to remember because it's eai so since ai is so popular so we're elevating commercial excellence first of all in the first wave and i'll talk more about what that means We're accelerating intelligent monitoring in that second wave. we're accelerating intelligent monitoring in that second wave And then we're innovating and launching wearables more significantly in the third wave as we look over this time period. So in the first wave, we're starting to take some of our algorithms that have been developed over the last three to five years that some were developed for the consumer space, and we're redeploying those algorithms into the hospital. So the first one is what we call the SedLine, which is a smarter algorithm for our brain monitoring portfolio. The second one is the SedLine for opioid-induced respiratory depression, and I'll talk a little bit more about that. And then in terms of future algorithm categories, you see that we have AFib detection, predictive respiratory depression, oxygen delivery, sepsis, autoregulation, and seizure detection as algorithms in our pipeline. And then we're innovating and launching wearables more significantly in the third wave as we look over this time period. and then we're innovating and launching wearables more significantly in the third wave as we look over this time period So in the first wave, we're starting to take some of our algorithms that have been developed over the last three to five years that some were developed for the consumer space, and we're redeploying those algorithms into the hospital. so in the first wave we're starting to take some of our algorithms that have been developed over the last three to five years that some were developed for the consumer space and we're redeploying those algorithms into the hospital So the first one is what we call the SedLine, which is a smarter algorithm for our brain monitoring portfolio. so the first one is what we call the sedline which is a smarter algorithm for our brain monitoring portfolio The second one is the SedLine for opioid-induced respiratory depression, and I'll talk a little bit more about that. the second one is the sedline for opioid-induced respiratory depression and i'll talk a little bit more about that And then in terms of future algorithm categories, you see that we have AFib detection, predictive respiratory depression, oxygen delivery, sepsis, autoregulation, and seizure detection as algorithms in our pipeline. and then in terms of future algorithm categories you see that we have afib detection predictive respiratory depression oxygen delivery sepsis autoregulation and seizure detection as algorithms in our pipeline And one of the core technologies that started Masimo was around signal detection and signal processing and truly algorithm development to get the most accuracy. And so you see us really continuing to play that forward as we attack new disease states and come up with new algorithms for improving patient care. And then on the monitor side, this year, we'll be going to a full market launch of our product called Radius VSM. And that's essentially kind of a first-generation wearable technology that's worn on the patient's arm. And it has a non-invasive blood pressure cuff. It has continuous pulse ox monitoring, and it has the ability to do EKG monitoring of a patient while they're in their own hospital room, whether it's in the med-surg floors or the floors that are typically not monitored. And one of the core technologies that started Masimo was around signal detection and signal processing and truly algorithm development to get the most accuracy. and one of the core technologies that started masimo was around signal detection and signal processing and truly algorithm development to get the most accuracy And so you see us really continuing to play that forward as we attack new disease states and come up with new algorithms for improving patient care. and so you see us really continuing to play that forward as we attack new disease states and come up with new algorithms for improving patient care And then on the monitor side, this year, we'll be going to a full market launch of our product called Radius VSM. and then on the monitor side this year we'll be going to a full market launch of our product called radius vsm And that's essentially kind of a first-generation wearable technology that's worn on the patient's arm. and that's essentially kind of a first-generation wearable technology that's worn on the patient's arm And it has a non-invasive blood pressure cuff. and it has a non-invasive blood pressure cuff It has continuous pulse ox monitoring, and it has the ability to do EKG monitoring of a patient while they're in their own hospital room, whether it's in the med- surg floors or the floors that are typically not monitored. it has continuous pulse ox monitoring and it has the ability to do ekg monitoring of a patient while they're in their own hospital room whether it's in the med- surg floors or the floors that are typically not monitored This is a fantastic product that we've been working on for the last several years. This year, we kept it in pilot mode so we could fix some of the feedback that we were getting from our pilot accounts, the top five across the country, and now we're going to a full launch mode. The other thing I wanted to highlight for you is our next-gen monitors, and so we have a global installed base of about 100,000 monitors. About 30% of those monitors are in the OR and the ICU in the high acuity environment, and about 70% of those monitors are more your intermittent vital signs monitors that are used for spot checking patients on the floors, and so we have not actually launched a brand new monitoring platform in over 10 years. This is a fantastic product that we've been working on for the last several years. this is a fantastic product that we've been working on for the last several years This year, we kept it in pilot mode so we could fix some of the feedback that we were getting from our pilot accounts, the top five across the country, and now we're going to a full launch mode. this year we kept it in pilot mode so we could fix some of the feedback that we were getting from our pilot accounts the top five across the country and now we're going to a full launch mode The other thing I wanted to highlight for you is our next-gen monitors, and so we have a global installed base of about 100,000 monitors. the other thing i wanted to highlight for you is our next-gen monitors and so we have a global installed base of about 100,000 monitors About 30% of those monitors are in the OR and the ICU in the high acuity environment, and about 70% of those monitors are more your intermittent vital signs monitors that are used for spot checking patients on the floors, and so we have not actually launched a brand new monitoring platform in over 10 years. about 30% of those monitors are in the or and the icu in the high acuity environment and about 70% of those monitors are more your intermittent vital signs monitors that are used for spot checking patients on the floors and so we have not actually launched a brand new monitoring platform in over 10 years And so the goal that we have is to come out with our next-generation high and low acuity monitor. It will come out by the end of this year. Our next-gen Root vital signs monitor will come out by the end of 2027. That offers us an opportunity to actually begin to sell a higher quality capital or kind of brand new platform with AI algorithms on it, larger screens, and then based on all the feedback that we've gotten on our Root platforms over the last 10 years. We are very excited about that opportunity because if you imagine 100,000x a price point, even if you imagine the price point to be $5,000-$10,000, you can imagine that is a really big opportunity for us to sell capital into our installed base. And so the goal that we have is to come out with our next-generation high and low acuity monitor. and so the goal that we have is to come out with our next-generation high and low acuity monitor It will come out by the end of this year. it will come out by the end of this year Our next-gen Root vital signs monitor will come out by the end of 2027. our next-gen root vital signs monitor will come out by the end of 2027 That offers us an opportunity to actually begin to sell a higher quality capital or kind of brand new platform with AI algorithms on it, larger screens, and then based on all the feedback that we've gotten on our Root platforms over the last 10 years. that offers us an opportunity to actually begin to sell a higher quality capital or kind of brand new platform with ai algorithms on it larger screens and then based on all the feedback that we've gotten on our root platforms over the last 10 years We are very excited about that opportunity because if you imagine 100,000x a price point, even if you imagine the price point to be $5,000-$10,000, you can imagine that is a really big opportunity for us to sell capital into our installed base. we are very excited about that opportunity because if you imagine 100,000x a price point even if you imagine the price point to be $5,000-$10,000 you can imagine that is a really big opportunity for us to sell capital into our installed base Then just one last comment before I move on about wearables that we really have an opportunity with wearables. We already have the W1 Watch, which has been cleared by the FDA. We also have a device called Radius PPG. We have probably like five to 10 different wearable options. And as an organization, we're really putting together in detail our wearable strategy, and then we're going to be launching it into that opportunity of continuous monitoring across the hospital, trying to get that best portfolio that's going to work with hospital workflows and actually be the best for patients. So a lot of that is not entirely baked in because it's kind of our 2028 and plus, so it's kind of beyond the long-range plan. But we see that as a tremendous opportunity. Then just one last comment before I move on about wearables that we really have an opportunity with wearables. then just one last comment before i move on about wearables that we really have an opportunity with wearables We already have the W1 Watch, which has been cleared by the FDA. we already have the w1 watch which has been cleared by the fda We also have a device called Radius PPG. we also have a device called radius ppg We have probably like five to 10 different wearable options. we have probably like five to 10 different wearable options And as an organization, we're really putting together in detail our wearable strategy, and then we're going to be launching it into that opportunity of continuous monitoring across the hospital, trying to get that best portfolio that's going to work with hospital workflows and actually be the best for patients. and as an organization we're really putting together in detail our wearable strategy and then we're going to be launching it into that opportunity of continuous monitoring across the hospital trying to get that best portfolio that's going to work with hospital workflows and actually be the best for patients So a lot of that is not entirely baked in because it's kind of our 2028 and plus, so it's kind of beyond the long-range plan. so a lot of that is not entirely baked in because it's kind of our 2028 and plus so it's kind of beyond the long-range plan But we see that as a tremendous opportunity. but we see that as a tremendous opportunity So I'll just spend a few minutes quickly doing a deep dive on the smart sensor family that we'll be launching. So the first one is the opioid-induced respiratory depression. And to give you a little bit of background on that algorithm, we have worked on it for about five years as an organization. It took us about the first three years to gather data on what happens to patients when they have an opioid-induced very rapid respiratory depression event. So if you have opioid, if you're taking a lot of opioids, you can actually have a sudden crash where you're not breathing, and it's very dangerous, and patients can actually die. So we developed that algorithm in both the home and the hospital environment. So I'll just spend a few minutes quickly doing a deep dive on the smart sensor family that we'll be launching. so i'll just spend a few minutes quickly doing a deep dive on the smart sensor family that we'll be launching So the first one is the opioid-induced respiratory depression. so the first one is the opioid-induced respiratory depression And to give you a little bit of background on that algorithm, we have worked on it for about five years as an organization. and to give you a little bit of background on that algorithm we have worked on it for about five years as an organization It took us about the first three years to gather data on what happens to patients when they have an opioid-induced very rapid respiratory depression event. it took us about the first three years to gather data on what happens to patients when they have an opioid-induced very rapid respiratory depression event So if you have opioid, if you're taking a lot of opioids, you can actually have a sudden crash where you're not breathing, and it's very dangerous, and patients can actually die. so if you have opioid if you're taking a lot of opioids you can actually have a sudden crash where you're not breathing and it's very dangerous and patients can actually die So we developed that algorithm in both the home and the hospital environment. so we developed that algorithm in both the home and the hospital environment We then submitted that algorithm to the FDA, and it was a de novo, first to the world submission, and it took us 18 months to get the algorithm cleared. So what we're doing now is saying we're going to create a smart sensor that is able to unlock that algorithm in the software of our monitors inside the hospital. And we've already put that submission into the FDA here at the end of December. So we anticipate getting clearance of that for the first half of this year, and then we'll be launching in the second half of 2026. On atrial fibrillation, similar story. We've been working for about three years on gathering the clinical data to show that we can detect AFib with just a pulse ox sensor. And I know many people will have watches and things that are looking at AFib for themselves at home. We then submitted that algorithm to the FDA, and it was a de novo, first to the world submission, and it took us 18 months to get the algorithm cleared. we then submitted that algorithm to the fda and it was a de novo first to the world submission and it took us 18 months to get the algorithm cleared So what we're doing now is saying we're going to create a smart sensor that is able to unlock that algorithm in the software of our monitors inside the hospital. so what we're doing now is saying we're going to create a smart sensor that is able to unlock that algorithm in the software of our monitors inside the hospital And we've already put that submission into the FDA here at the end of December. and we've already put that submission into the fda here at the end of december So we anticipate getting clearance of that for the first half of this year, and then we'll be launching in the second half of 2026. so we anticipate getting clearance of that for the first half of this year and then we'll be launching in the second half of 2026 On atrial fibrillation, similar story. on atrial fibrillation similar story We've been working for about three years on gathering the clinical data to show that we can detect AFib with just a pulse ox sensor. we've been working for about three years on gathering the clinical data to show that we can detect afib with just a pulse ox sensor And I know many people will have watches and things that are looking at AFib for themselves at home. and i know many people will have watches and things that are looking at afib for themselves at home So this is really a very highly accurate way to detect that something's going on with the patient's heart rhythms, which would allow the hospitals and the nurses to immediately react and be able to escalate up those patients' care to telemetry, to interventions that would actually get them out of atrial fibrillation while they're in the hospital in recovery. And then the future would be that we would develop algorithms to predict a respiratory depression event using our same database. And so once you gather the data for three years, it's easier then to iterate and expand those algorithms. So just to close out on this point, the key takeaways are that we have given guidance in the long-range plan for 7%-10%. We have a new team. We have a new product pipeline. So this is really a very highly accurate way to detect that something's going on with the patient's heart rhythms, which would allow the hospitals and the nurses to immediately react and be able to escalate up those patients' care to telemetry, to interventions that would actually get them out of atrial fibrillation while they're in the hospital in recovery. so this is really a very highly accurate way to detect that something's going on with the patient's heart rhythms which would allow the hospitals and the nurses to immediately react and be able to escalate up those patients' care to telemetry to interventions that would actually get them out of atrial fibrillation while they're in the hospital in recovery And then the future would be that we would develop algorithms to predict a respiratory depression event using our same database. and then the future would be that we would develop algorithms to predict a respiratory depression event using our same database And so once you gather the data for three years, it's easier then to iterate and expand those algorithms. and so once you gather the data for three years it's easier then to iterate and expand those algorithms So just to close out on this point, the key takeaways are that we have given guidance in the long-range plan for 7%-10%. so just to close out on this point the key takeaways are that we have given guidance in the long-range plan for 7%-10% We have a new team. we have a new team We have a new product pipeline. we have a new product pipeline We are very focused on the hospital environment, and we have a lot of momentum because we've delivered on 2025, and we have tons of momentum as we go into 2026, and we're really excited to continue to help and impact the lives of 200 million more patients per year in the future, so thank you all very much for listening, and we will open it up for questions. Thanks. We are very focused on the hospital environment, and we have a lot of momentum because we've delivered on 2025, and we have tons of momentum as we go into 2026, and we're really excited to continue to help and impact the lives of 200 million more patients per year in the future, so thank you all very much for listening, and we will open it up for questions. we are very focused on the hospital environment and we have a lot of momentum because we've delivered on 2025 and we have tons of momentum as we go into 2026 and we're really excited to continue to help and impact the lives of 200 million more patients per year in the future so thank you all very much for listening and we will open it up for questions Thanks. thanks

Speaker 4: Thank you, Katie. So now we'll transition to Q&A, and if you have a question, please raise your hand. I believe mics will be coming around the room. So we also have an online audience, and here's a question that just came in. So, Katie, AI has been an integral part of the zeitgeist. What plan does Masimo have for AI and integrating or incorporating the technology into your portfolio? And then maybe a follow-up would be, why do you think Masimo's use of AI would be differentiated from your competition? Thank you, Katie. thank you katie So now we'll transition to Q&A, and if you have a question, please raise your hand. so now we'll transition to q&a and if you have a question please raise your hand I believe mics will be coming around the room. i believe mics will be coming around the room So we also have an online audience, and here's a question that just came in. so we also have an online audience and here's a question that just came in So, Katie, AI has been an integral part of the zeitgeist. so katie ai has been an integral part of the zeitgeist What plan does Masimo have for AI and integrating or incorporating the technology into your portfolio? what plan does masimo have for ai and integrating or incorporating the technology into your portfolio And then maybe a follow-up would be, why do you think Masimo's use of AI would be differentiated from your competition? and then maybe a follow-up would be why do you think masimo's use of ai would be differentiated from your competition

Speaker 3: Yeah, so thanks. I mean, a lot of what I just shared was kind of our AI pipeline. I think the reason why Masimo will be differentiated from the competition is that we have an amazing team of 30 engineers in our algorithm department. One of them actually is one of the founding engineers who's been; I think he was employee number 12. He's been with us for 33 years, and the algorithm development was really the core of Masimo technology. In those days, they just called it math, and then now we call it artificial intelligence, and so I think as you see that evolution, we already have a strength in it, and I think that we will continue with all the algorithms that I showed to find ways because AI only matters if it's really going to impact patient care and make it better. Yeah, so thanks. yeah so thanks I mean, a lot of what I just shared was kind of our AI pipeline. i mean a lot of what i just shared was kind of our ai pipeline I think the reason why Masimo will be differentiated from the competition is that we have an amazing team of 30 engineers in our algorithm department. i think the reason why masimo will be differentiated from the competition is that we have an amazing team of 30 engineers in our algorithm department One of them actually is one of the founding engineers who's been; I think he was employee number 12. one of them actually is one of the founding engineers who's been i think he was employee number 12 He's been with us for 33 years, and the algorithm development was really the core of Masimo technology. he's been with us for 33 years and the algorithm development was really the core of masimo technology In those days, they just called it math, and then now we call it artificial intelligence, and so I think as you see that evolution, we already have a strength in it, and I think that we will continue with all the algorithms that I showed to find ways because AI only matters if it's really going to impact patient care and make it better. in those days they just called it math and then now we call it artificial intelligence and so i think as you see that evolution we already have a strength in it and i think that we will continue with all the algorithms that i showed to find ways because ai only matters if it's really going to impact patient care and make it better You don't just do AI just so you can say that you're doing AI, and so I think we've already used machine learning to develop a lot of our algorithms and that we will continue to do that, staying patient-focused to solve true clinical problems, and I think that's why we'll always win in the future. You don't just do AI just so you can say that you're doing AI, and so I think we've already used machine learning to develop a lot of our algorithms and that we will continue to do that, staying patient-focused to solve true clinical problems, and I think that's why we'll always win in the future. you don't just do ai just so you can say that you're doing ai and so i think we've already used machine learning to develop a lot of our algorithms and that we will continue to do that staying patient-focused to solve true clinical problems and i think that's why we'll always win in the future

Speaker 4: Thank you. Give a second for the audience. Another question came in from the online audience about maybe your growth strategy that you presented. So that involved U.S. pulse ox, international pulse ox, expanding market share for your advanced monitoring product portfolio, and launching new innovative products. Which of these components are you most excited about and investors should be focused on? Thank you. thank you Give a second for the audience. give a second for the audience Another question came in from the online audience about maybe your growth strategy that you presented. another question came in from the online audience about maybe your growth strategy that you presented So that involved U.S. pulse ox, international pulse ox, expanding market share for your advanced monitoring product portfolio, and launching new innovative products. so that involved u.s pulse ox international pulse ox expanding market share for your advanced monitoring product portfolio and launching new innovative products Which of these components are you most excited about and investors should be focused on? which of these components are you most excited about and investors should be focused on

Speaker 3: Is that you, Micah? Why don't you go first, and then I'll... Is that you, Micah? is that you micah Why don't you go first, and then I'll... why don't you go first and then i'll

Speaker 1: Let me go. Yeah, I think looking at the, we've got a lot of great innovation coming in the next three to four years. And if I look at what I'm probably most excited about is some of the AI algorithms. We did a lot of great work on some of these algorithms that were being used outside the hospital, and we were bringing those back in for indications in the hospital. And if you look at whether it's opioid-induced respiratory depression or the AFib detection, I think those are exciting because that's going to drive significant value to customers, and especially for those patients who are coming through the hospital who are dealing with AFib or, as Katie mentioned earlier on one of the slides, it showed that up to 46% of patients who are post-surgery are taking opioids. Let me go. let me go Yeah, I think looking at the, we've got a lot of great innovation coming in the next three to four years. yeah i think looking at the we've got a lot of great innovation coming in the next three to four years And if I look at what I'm probably most excited about is some of the AI algorithms. and if i look at what i'm probably most excited about is some of the ai algorithms We did a lot of great work on some of these algorithms that were being used outside the hospital, and we were bringing those back in for indications in the hospital. we did a lot of great work on some of these algorithms that were being used outside the hospital and we were bringing those back in for indications in the hospital And if you look at whether it's opioid-induced respiratory depression or the AFib detection, I think those are exciting because that's going to drive significant value to customers, and especially for those patients who are coming through the hospital who are dealing with AFib or, as Katie mentioned earlier on one of the slides, it showed that up to 46% of patients who are post-surgery are taking opioids. and if you look at whether it's opioid-induced respiratory depression or the afib detection i think those are exciting because that's going to drive significant value to customers and especially for those patients who are coming through the hospital who are dealing with afib or as katie mentioned earlier on one of the slides it showed that up to 46% of patients who are post-surgery are taking opioids And to be able to save lives with that kind of technology is incredible. And I think we can recognize the value for Masimo as we demonstrate that value to customers. And then I think Root Squared, just the capabilities of that connectivity platform, being able to refresh the install base. We do have a large install base out there that's going to refresh over the coming years as we launch that. And it's a very expandable platform. It can handle a lot of different connectivity to a lot of devices in the hospital. And it's also going to be a great expandable platform for our wearables as we start to launch those in the coming years as well. And to be able to save lives with that kind of technology is incredible. and to be able to save lives with that kind of technology is incredible And I think we can recognize the value for Masimo as we demonstrate that value to customers. and i think we can recognize the value for masimo as we demonstrate that value to customers And then I think Root Squared, just the capabilities of that connectivity platform, being able to refresh the install base. and then i think root squared just the capabilities of that connectivity platform being able to refresh the install base We do have a large install base out there that's going to refresh over the coming years as we launch that. we do have a large install base out there that's going to refresh over the coming years as we launch that And it's a very expandable platform. and it's a very expandable platform It can handle a lot of different connectivity to a lot of devices in the hospital. it can handle a lot of different connectivity to a lot of devices in the hospital And it's also going to be a great expandable platform for our wearables as we start to launch those in the coming years as well. and it's also going to be a great expandable platform for our wearables as we start to launch those in the coming years as well

Speaker 4: Thank you, Micah. Thank you, Micah. thank you micah

Speaker 3: I think what I'm excited about is just the same, but as we launch these new algorithms, I'm excited to see the reaction of doctors and clinicians. And so we've had two advisory boards already where we showed them kind of the list of all the R&D projects and said, "What would you?" We had them use Monopoly money and vote on what they would prioritize first. And AFib detection was actually always voted as number one in each of the environments. And then the second was around the next-gen Root monitors and the ability to have a full screen because the existing Root monitors were super innovative when they first came out. But now, as we've added more and more technology, it's a very narrow screen, and so people want kind of more real estate to be able to see more of the parameters at the same time. I think what I'm excited about is just the same, but as we launch these new algorithms, I'm excited to see the reaction of doctors and clinicians. i think what i'm excited about is just the same but as we launch these new algorithms i'm excited to see the reaction of doctors and clinicians And so we've had two advisory boards already where we showed them kind of the list of all the R&D projects and said, "What would you?" We had them use Monopoly money and vote on what they would prioritize first. and so we've had two advisory boards already where we showed them kind of the list of all the r&d projects and said "what would you?" we had them use monopoly money and vote on what they would prioritize first And AFib detection was actually always voted as number one in each of the environments. and afib detection was actually always voted as number one in each of the environments And then the second was around the next-gen Root monitors and the ability to have a full screen because the existing Root monitors were super innovative when they first came out. and then the second was around the next-gen root monitors and the ability to have a full screen because the existing root monitors were super innovative when they first came out But now, as we've added more and more technology, it's a very narrow screen, and so people want kind of more real estate to be able to see more of the parameters at the same time. but now as we've added more and more technology it's a very narrow screen and so people want kind of more real estate to be able to see more of the parameters at the same time

Speaker 4: Awesome. Thank you. Another question just came in. So you mentioned currently unmonitored patients in low acuity settings is an untapped market that presents a compelling growth opportunity. Can you please elaborate on what you mean by untapped and why this provides upside opportunity for Masimo? Awesome. awesome Thank you. thank you Another question just came in. another question just came in So you mentioned currently unmonitored patients in low acuity settings is an untapped market that presents a compelling growth opportunity. so you mentioned currently unmonitored patients in low acuity settings is an untapped market that presents a compelling growth opportunity Can you please elaborate on what you mean by untapped and why this provides upside opportunity for Masimo? can you please elaborate on what you mean by untapped and why this provides upside opportunity for masimo

Speaker 3: Yeah, I think the reason why it's untapped is I think that really for hospital and hospital CEOs, people kind of just do the standard of care, and right now, the standard of care is to monitor a patient intermittently every four or eight hours, depending on what the doctor has written in the prescription for that patient, and I think that's really untapped because where we see hospitals have a lot of passion to go with continuous monitoring is when they have a seminal event where a patient may die accidentally, and that causes the hospital to say, "Wow, we should have monitored this patient, and we should monitor all patients all the time," so then we have very motivated hospitals and doctors that will work on it with us, but that shouldn't be the way it should be. Yeah, I think the reason why it's untapped is I think that really for hospital and hospital CEOs, people kind of just do the standard of care, and right now, the standard of care is to monitor a patient intermittently every four or eight hours, depending on what the doctor has written in the prescription for that patient, and I think that's really untapped because where we see hospitals have a lot of passion to go with continuous monitoring is when they have a seminal event where a patient may die accidentally, and that causes the hospital to say, "Wow, we should have monitored this patient, and we should monitor all patients all the time," so then we have very motivated hospitals and doctors that will work on it with us, but that shouldn't be the way it should be. yeah i think the reason why it's untapped is i think that really for hospital and hospital ceos people kind of just do the standard of care and right now the standard of care is to monitor a patient intermittently every four or eight hours depending on what the doctor has written in the prescription for that patient and i think that's really untapped because where we see hospitals have a lot of passion to go with continuous monitoring is when they have a seminal event where a patient may die accidentally and that causes the hospital to say "wow we should have monitored this patient and we should monitor all patients all the time," so then we have very motivated hospitals and doctors that will work on it with us but that shouldn't be the way it should be It should be that the motivation should be preventive patient safety where you monitor all patients all the time while they're in the hospital. You find ways to do that in a way that's much less expensive and actually saves the hospital system's money. I think historically, the reason why people never did it is because it was too expensive. I mean, the technology was not available, and now the technology is ubiquitous for all of us to be able to monitor ourselves, so we should be able to do the same for patients in the hospital too. It should be that the motivation should be preventive patient safety where you monitor all patients all the time while they're in the hospital. it should be that the motivation should be preventive patient safety where you monitor all patients all the time while they're in the hospital You find ways to do that in a way that's much less expensive and actually saves the hospital system's money. you find ways to do that in a way that's much less expensive and actually saves the hospital system's money I think historically, the reason why people never did it is because it was too expensive. i think historically the reason why people never did it is because it was too expensive I mean, the technology was not available, and now the technology is ubiquitous for all of us to be able to monitor ourselves, so we should be able to do the same for patients in the hospital too. i mean the technology was not available and now the technology is ubiquitous for all of us to be able to monitor ourselves so we should be able to do the same for patients in the hospital too

Speaker 4: Thank you. Another question would be, so you're nearing the anniversary of your tenure as CEO. Congratulations, first off. Thank you. thank you Another question would be, so you're nearing the anniversary of your tenure as CEO. another question would be so you're nearing the anniversary of your tenure as ceo Congratulations, first off. congratulations first off

Speaker 3: Thank you. Thank you. thank you

Speaker 4: What are you most excited about going forward? What are you most excited about going forward? what are you most excited about going forward

Speaker 3: Yeah, I think that Masimo has gone through a lot of transition in the last several years, and so what I'm most excited about is I feel like 2025 for us was a year of stabilization that I've been there now for a whole year. We've made some really great improvements as we've gone through the year, and we delivered on our commitments, and so I feel like 2025 was stabilization and execution and forming the strategy. And 2026 is really building momentum, and we're starting to see a lot of momentum with people understanding what we need to do, people getting excited about the impact it's going to have on patient care, and then just really working together on momentum to deliver next year. So for that reason, we're really, really excited. Yeah, I think that Masimo has gone through a lot of transition in the last several years, and so what I'm most excited about is I feel like 2025 for us was a year of stabilization that I've been there now for a whole year. yeah i think that masimo has gone through a lot of transition in the last several years and so what i'm most excited about is i feel like 2025 for us was a year of stabilization that i've been there now for a whole year We've made some really great improvements as we've gone through the year, and we delivered on our commitments, and so I feel like 2025 was stabilization and execution and forming the strategy. we've made some really great improvements as we've gone through the year and we delivered on our commitments and so i feel like 2025 was stabilization and execution and forming the strategy And 2026 is really building momentum, and we're starting to see a lot of momentum with people understanding what we need to do, people getting excited about the impact it's going to have on patient care, and then just really working together on momentum to deliver next year. and 2026 is really building momentum and we're starting to see a lot of momentum with people understanding what we need to do people getting excited about the impact it's going to have on patient care and then just really working together on momentum to deliver next year So for that reason, we're really, really excited. so for that reason we're really really excited And I feel like for me, looking back, my husband put in our holiday card that he sent out to everyone we know that Katie took a new job, and we've never seen her since. So I'm personally looking forward to maybe seeing my family a little bit more next year. I don't know if that's possible because people say the second year is always quite intense too. But we have a lot to do as a team, and I'm really excited to be a part of this team to make it happen. Masimo is a great company, and we have great potential. And I feel like for me, looking back, my husband put in our holiday card that he sent out to everyone we know that Katie took a new job, and we've never seen her since. and i feel like for me looking back my husband put in our holiday card that he sent out to everyone we know that katie took a new job and we've never seen her since So I'm personally looking forward to maybe seeing my family a little bit more next year. so i'm personally looking forward to maybe seeing my family a little bit more next year I don't know if that's possible because people say the second year is always quite intense too. i don't know if that's possible because people say the second year is always quite intense too But we have a lot to do as a team, and I'm really excited to be a part of this team to make it happen. but we have a lot to do as a team and i'm really excited to be a part of this team to make it happen Masimo is a great company, and we have great potential. masimo is a great company and we have great potential

Speaker 4: Let's see. So. Let's see. let's see So. so

Speaker 3: I don't know, Micah, what do you think? I don't know, Micah, what do you think? i don't know micah what do you think

Speaker 1: As far as the. As far as the. as far as the

Speaker 3: Yeah, just things you're excited about in 2026. Yeah, just things you're excited about in 2026. yeah just things you're excited about in 2026

Speaker 1: Yeah, I mean, I'm excited. I think we've, like you said, last year was a stabilization year for the company. I think a lot of change we went through, and I think the team is re-energized again. And I think we've got an exciting pipeline of innovation that we're going to, all these new products that we're going to launch. And I think the team's excited about delivering those to our customers and to patients. And a lot of that's going to start to play out in 2026, and I think we're set up for success. Yeah, I mean, I'm excited. yeah i mean i'm excited I think we've, like you said, last year was a stabilization year for the company. i think we've like you said last year was a stabilization year for the company I think a lot of change we went through, and I think the team is re-energized again. i think a lot of change we went through and i think the team is re-energized again And I think we've got an exciting pipeline of innovation that we're going to, all these new products that we're going to launch. and i think we've got an exciting pipeline of innovation that we're going to all these new products that we're going to launch And I think the team's excited about delivering those to our customers and to patients. and i think the team's excited about delivering those to our customers and to patients And a lot of that's going to start to play out in 2026, and I think we're set up for success. and a lot of that's going to start to play out in 2026 and i think we're set up for success

Speaker 4: You also just presented ambitions to continue strong revenue growth, operating margin improvement, EPS growth in 2026 and beyond. Can you elaborate how Masimo's financial performance in 2025, and together with executing on the strategy and the plan that you just presented, how does that set up Masimo for an even better 2026 and beyond? You also just presented ambitions to continue strong revenue growth, operating margin improvement, EPS growth in 2026 and beyond. you also just presented ambitions to continue strong revenue growth operating margin improvement eps growth in 2026 and beyond Can you elaborate how Masimo's financial performance in 2025, and together with executing on the strategy and the plan that you just presented, how does that set up Masimo for an even better 2026 and beyond? can you elaborate how masimo's financial performance in 2025 and together with executing on the strategy and the plan that you just presented how does that set up masimo for an even better 2026 and beyond

Speaker 1: Yeah, I can start. Yeah, I can start. yeah i can start

Speaker 3: Go ahead, Micah. Micah, why don't you start? Go ahead, Micah. go ahead micah micah Micah, why don't you start? micah why don't you start

Speaker 1: So as we came into 2025, we had a few curveballs. Everybody was facing new tariffs. When we initiated guidance coming into last year, we set that this time last year. And as the year played out, tariffs came on, and we still delivered strong earnings, margin improvement, strong revenue growth last year. And our earnings exceeded not only the initial guidance, but also with the tariff headwinds, we exceeded that guidance, and we did not know about that coming into the year. And we navigated through second quarter, which was another curveball, which was we had a cyber attack on the company. And being able to still recover from that, we've got a very nimble team, and they worked effortlessly to just get product out to customers and recover from that event. So as we came into 2025, we had a few curveballs. so as we came into 2025 we had a few curveballs Everybody was facing new tariffs. everybody was facing new tariffs When we initiated guidance coming into last year, we set that this time last year. when we initiated guidance coming into last year we set that this time last year And as the year played out, tariffs came on, and we still delivered strong earnings, margin improvement, strong revenue growth last year. and as the year played out tariffs came on and we still delivered strong earnings margin improvement strong revenue growth last year And our earnings exceeded not only the initial guidance, but also with the tariff headwinds, we exceeded that guidance, and we did not know about that coming into the year. and our earnings exceeded not only the initial guidance but also with the tariff headwinds we exceeded that guidance and we did not know about that coming into the year And we navigated through second quarter, which was another curveball, which was we had a cyber attack on the company. and we navigated through second quarter which was another curveball which was we had a cyber attack on the company And being able to still recover from that, we've got a very nimble team, and they worked effortlessly to just get product out to customers and recover from that event. and being able to still recover from that we've got a very nimble team and they worked effortlessly to just get product out to customers and recover from that event To be able to navigate all that and still deliver on our commitments this past year, I'm really proud of the team, and that's what makes us excited about 2026 and moving forward. I mean, we've got a strong team, a very capable team of launching these products, executing. We finished the year strong last year, as you saw our results that Katie mentioned earlier. Strong contracting to finish the year, which sets us up with great momentum coming into 2026, and we're on the right track. To be able to navigate all that and still deliver on our commitments this past year, I'm really proud of the team, and that's what makes us excited about 2026 and moving forward. to be able to navigate all that and still deliver on our commitments this past year i'm really proud of the team and that's what makes us excited about 2026 and moving forward I mean, we've got a strong team, a very capable team of launching these products, executing. i mean we've got a strong team a very capable team of launching these products executing We finished the year strong last year, as you saw our results that Katie mentioned earlier. we finished the year strong last year as you saw our results that katie mentioned earlier Strong contracting to finish the year, which sets us up with great momentum coming into 2026, and we're on the right track. strong contracting to finish the year which sets us up with great momentum coming into 2026 and we're on the right track

Speaker 3: Yeah, and I guess my comment would be at the end of 2024, before I joined, Micah and the team kind of led an effort to really refocus back on the core medtech business, and that involved restructuring to eliminate some of our roles related to consumer, and so what I've actually been so impressed with as we've gone through this year is that we have ample opportunity to invest in R&D with the 8% levels that we have. We have a strong and committed R&D organization. We've really seen turnover kind of come down dramatically over the last couple of years, and we really see a lot of momentum in the organization. Yeah, and I guess my comment would be at the end of 2024, before I joined, Micah and the team kind of led an effort to really refocus back on the core medtech business, and that involved restructuring to eliminate some of our roles related to consumer, and so what I've actually been so impressed with as we've gone through this year is that we have ample opportunity to invest in R&D with the 8% levels that we have. yeah and i guess my comment would be at the end of 2024 before i joined micah and the team kind of led an effort to really refocus back on the core medtech business and that involved restructuring to eliminate some of our roles related to consumer and so what i've actually been so impressed with as we've gone through this year is that we have ample opportunity to invest in r&d with the 8% levels that we have We have a strong and committed R&D organization. we have a strong and committed r&d organization We've really seen turnover kind of come down dramatically over the last couple of years, and we really see a lot of momentum in the organization. we've really seen turnover kind of come down dramatically over the last couple of years and we really see a lot of momentum in the organization And so now, after that kind of one-time reset where I was concerned maybe coming in, do we have enough spending, I can confidently say that we have enough to invest, that as we're doing these next-gen products, they're more predictable and they're technologies that we know how to do, and that now it's going to be about natural leverage, which is that as we grow, it will continue to drive more profitability. We don't have to do major change. We can actually just grow with this momentum and deliver those results. And high profitability, high cash flow, we've been able to do share buybacks. We really have a lot of opportunity just with the natural leverage of the company. So we're confident in the future. And so now, after that kind of one-time reset where I was concerned maybe coming in, do we have enough spending, I can confidently say that we have enough to invest, that as we're doing these next-gen products, they're more predictable and they're technologies that we know how to do, and that now it's going to be about natural leverage, which is that as we grow, it will continue to drive more profitability. and so now after that kind of one-time reset where i was concerned maybe coming in do we have enough spending i can confidently say that we have enough to invest that as we're doing these next-gen products they're more predictable and they're technologies that we know how to do and that now it's going to be about natural leverage which is that as we grow it will continue to drive more profitability We don't have to do major change. we don't have to do major change We can actually just grow with this momentum and deliver those results. we can actually just grow with this momentum and deliver those results And high profitability, high cash flow, we've been able to do share buybacks. and high profitability high cash flow we've been able to do share buybacks We really have a lot of opportunity just with the natural leverage of the company. we really have a lot of opportunity just with the natural leverage of the company So we're confident in the future. so we're confident in the future

Speaker 4: Thank you both. Any additional questions from the audience? Thank you both. thank you both Any additional questions from the audience? any additional questions from the audience

Speaker 1: I can't see anything. I can't see anything. i can't see anything

Speaker 4: Oh, this gentleman over there? I see a hand. Oh, this gentleman over there? oh this gentleman over there I see a hand. i see a hand First of all, congratulations on your one-year anniversary. My question would be, as you mentioned yourself, after going out of the operating room and the ICU, the patient basically stops being monitored. And my question would be, how do you see the telehealth opportunity playing out for Masimo? Would it be a direct-to-consumer, which I don't think would be really the case given the Sound United disposal, or would it be through the physician, the hospitals? Thank you. First of all, congratulations on your one-year anniversary. first of all congratulations on your one-year anniversary My question would be, as you mentioned yourself, after going out of the operating room and the ICU, the patient basically stops being monitored. my question would be as you mentioned yourself after going out of the operating room and the icu the patient basically stops being monitored And my question would be, how do you see the telehealth opportunity playing out for Masimo? and my question would be how do you see the telehealth opportunity playing out for masimo Would it be a direct-to-consumer, which I don't think would be really the case given the Sound United disposal, or would it be through the physician, the hospitals? would it be a direct-to-consumer which i don't think would be really the case given the sound united disposal or would it be through the physician the hospitals Thank you. thank you

Speaker 3: Yeah, thank you. That's a great question. So I think telehealth is the way that we're viewing it today is that it's really trying to focus on how do we enable hospitals to provide telehealth for their patients. So a lot of hospitals are trying to build programs. Even centralized governments are trying to build programs to create a telehealth setup. So what we're doing is actually selling telehealth solutions to the hospital system, and then they are providing that care into the home for those patients. So we're essentially enabling technology for telehealth with our wearable solutions. So we do see an opportunity for telehealth, and we have had a major pilot in one of the countries outside the United States this past year, and we actually have a team meeting next week to say, how do we take this global? What is the best setup? Yeah, thank you. yeah thank you That's a great question. that's a great question So I think telehealth is the way that we're viewing it today is that it's really trying to focus on how do we enable hospitals to provide telehealth for their patients. so i think telehealth is the way that we're viewing it today is that it's really trying to focus on how do we enable hospitals to provide telehealth for their patients So a lot of hospitals are trying to build programs. so a lot of hospitals are trying to build programs Even centralized governments are trying to build programs to create a telehealth setup. even centralized governments are trying to build programs to create a telehealth setup So what we're doing is actually selling telehealth solutions to the hospital system, and then they are providing that care into the home for those patients. so what we're doing is actually selling telehealth solutions to the hospital system and then they are providing that care into the home for those patients So we're essentially enabling technology for telehealth with our wearable solutions. so we're essentially enabling technology for telehealth with our wearable solutions So we do see an opportunity for telehealth, and we have had a major pilot in one of the countries outside the United States this past year, and we actually have a team meeting next week to say, how do we take this global? so we do see an opportunity for telehealth and we have had a major pilot in one of the countries outside the united states this past year and we actually have a team meeting next week to say how do we take this global What is the best setup? what is the best setup How do we actually enable hospitals to provide telehealth to their patients? So it's not like we're not doing it, but we don't plan to be the ones that sell direct-to-consumer because that's just not what we're good at. We're going to be selling and enabling hospitals and clinicians to do telehealth themselves. Thanks. How do we actually enable hospitals to provide telehealth to their patients? how do we actually enable hospitals to provide telehealth to their patients So it's not like we're not doing it, but we don't plan to be the ones that sell direct-to-consumer because that's just not what we're good at. so it's not like we're not doing it but we don't plan to be the ones that sell direct-to-consumer because that's just not what we're good at We're going to be selling and enabling hospitals and clinicians to do telehealth themselves. we're going to be selling and enabling hospitals and clinicians to do telehealth themselves Thanks. thanks

Speaker 4: Any additional questions? Any final remarks? If there are none, that will conclude today's session. Thank you all for coming. Any additional questions? any additional questions Any final remarks? any final remarks If there are none, that will conclude today's session. if there are none that will conclude today's session Thank you all for coming. thank you all for coming

Speaker 3: Thank you. Thank you. thank you

Speaker 4: Thank you. Thank you. thank you