Key Takeaways:
- Boston Scientific stated it will likely miss full-year sales forecasts.
- The Boston Scientific Cyberattack severely disrupted manufacturing and global shipping operations.
- Company leaders plan to share updated financial outlooks on October 28.
Medical device maker Boston Scientific disclosed on Tuesday that a recent cyberattack will likely prevent the company from meeting its third-quarter and full-year financial guidance targets.
Boston Scientific Warns Guidance Miss Due to Cyberattack
Boston Scientific submitted an official regulatory filing to the Securities and Exchange Commission explaining the financial fallout from the Boston Scientific Cyberattack.
The medical device maker stated that it is unlikely to meet net sales growth and adjusted earnings per share guidance ranges provided earlier in July. Company leaders noted that the unexpected network outage affected core manufacturing systems and blocked workers from processing customer orders.
The organization noted that full financial impacts remain unknown while recovery efforts continue worldwide. “The Company anticipates recovering some portion of the impacted revenue as it continues to ramp operations globally, fulfill customer orders and reduce remaining backlogs; however, the full impacts are not yet known,” Boston Scientific said in the filing.
Executives plan to provide updated operational and financial outlooks during an upcoming earnings call scheduled for October 28. Management also assured investors that the security breach will not cause material long-term damage to the corporate financial condition.
Company Restores Global Operations and Distribution Networks
Following the Boston Scientific Cyberattack on August 25, the company has made steady progress restoring global computer systems and supply chains over the past several weeks following the August 25 breach.
Distribution networks are substantially restored, and major distribution centers are now processing and shipping products at or above normal operating levels. Manufacturing has also resumed across most facilities worldwide, and all sterilization facilities are fully operational.
Despite these positive recovery steps, the business still lacks a firm timeline for a complete system recovery. The security incident started when unauthorized activity hit internal information technology systems, creating a massive network outage that locked employees out of business applications.
Company teams continue working around the clock to clear out remaining backlogs and secure all digital infrastructure against further threats.
Analysts Compare Incident Impacts Across Medical Industry
Boston Scientific Cyberattack is just one of several medical device companies targeted by cyberattacks over the past six months. Rival firm Stryker faced a similar security disruption earlier in the year that reduced its first-quarter financial results. Financial experts pointed out that Stryker had more months left in the calendar year to recover lost sales.
In contrast, Boston Scientific faces a tighter window with only four months remaining in the calendar year to recapture missed revenue. Company shares fell more than four percent to forty-five dollars and seventy-three cents following the latest financial disclosure.
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