Smith & Nephew shares slid after the U.K. medical-technology company cut 2026 revenue guidance and reported second-quarter sales that missed analysts' expectations due to weakness in its orthopedics division.
Shares are down 70.50 pence, or 5.9%, at 1,126.50 pence in London. It is the top FTSE 100 faller on Tuesday.
Smith & Nephew said it now expects 2026 underlying revenue growth of around 4%, lowered from its previous guidance of around 6%.
Revenue for the second quarter climbed 2.8% to $1.60 billion, or 1.6% on an underlying basis. This compared with analysts' expectations of $1.63 billion, according to consensus estimates provided by the company.
Smith & Nephew said weakness in its U.S. orthopedics and advanced-wound bioactive segments offset strength in its sports-medicine offering.
Orthopedics revenue was down 0.2% at $615 million due to temporary headwinds in U.S. hip implants and continued challenges for U.S. knee implants.
"Orthopedics is not where we want it to be, but we expect growth to accelerate as we fill portfolio gaps, starting later this year and continuing into 2027," Chief Executive Officer Deepak Nath said.
Revenue at the company's advanced wound management division fell 0.7% to $456 million in the second quarter, due to changes to U.S. reimbursement rules for skin substitutes that began at the start of the year.
RBC Capital Markets analysts said they expected a modestly negative reaction to the guidance cut, but noted that it might be the reset the market was looking for. Despite the revenue guidance cut, cost savings and tariff refunds are helping Smith & Nephew protect its bottom line, they added.
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