ST. PAUL, Minn. (AP) -- Shares of St. Jude Medical Inc. surged Wednesday after the medical device maker reported better-than-expected second-quarter earnings on higher sales of its heart-shocking implants.
The company raised the lower end of its full-year earnings-per-share guidance by 2 cents to a range between $3.70 and $3.73, and St. Jude shares rose $3.39, or 7 percent, to $51.83 in midday trading.
The maker of pacemakers and heart-shocking defibrillators reported a 4 percent decline in sales of those devices to $718 million, but that was still better than analysts expected.
St. Jude has been plagued over the past few years by recalls of wires for several heart devices. Leerink Swann analyst Daniella Antalffy said in a note that those problems are "subsiding a bit." She noted that St. Jude appeared to gain defibrillator market share in the quarter and now holds about 30.5 percent of the U.S. market. The company competes against fellow Minnesota device maker Medtronic Inc. and Boston Scientific Corp.
The company's total revenue was flat at $1.4 billion. Excluding the impact of foreign currency, sales rose 2 percent.
The company reported net income of $115 million, or 40 cents per share, down from $244 million, or 78 cents per share, a year earlier.
Excluding one-time debt repayment costs, the company would have earned 96 cents per share.
That was better than the average estimates of analysts polled by FactSet, who expected earnings of 94 cents per share on revenue of $1.36 billion.
For the third quarter, St. Jude Medical expects to earn 88 cents to 90 cents per share. Analysts expect earnings per share of 88 cents for the third quarter and $3.69 for the full year.
Last month St. Jude announced that the Food and Drug Administration had unexpectedly approved two new heart devices from the company, despite ongoing safety issues at a company plant in California. The approval of its next-generation Ellipse and SJM Assura devices came as a surprise, since the FDA has an outstanding warning letter at the Sylmar, Calif., facility where St. Jude manufactures its defibrillators. The FDA typically does not approve new devices from facilities that have unresolved warning letters.
In November the FDA released the results of an inspection of the facility, noting a number of problems with the company's testing procedures, indicating staffers were not following their own quality-control guidelines.