The following discussion and analysis contains forward-looking statements within
the meaning of the federal securities laws, and should be read in conjunction
with the disclosures we make concerning risks and other factors that may affect
our business and operating results. See "Note Regarding Forward-Looking
Statements" preceding Part I, Item 1 in this Quarterly Report on Form 10-Q.

We are the global leader in patient-focused medical innovations for structural
heart disease and critical care monitoring. Driven by a passion to help
patients, we partner with the world's leading clinicians and researchers and
invest in research and development to transform care for those impacted by
structural heart disease or who require hemodynamic monitoring during surgery or
intensive care. We conduct operations worldwide and are managed in the following
geographical regions: United States, Europe, Japan, and Rest of World. Our
products are categorized into the following main areas: Transcatheter Aortic
Valve Replacement ("TAVR"), Transcatheter Mitral and Tricuspid Therapies
("TMTT"), Surgical Structural Heart ("Surgical"), and Critical Care.

On May 7, 2020, our Board of Directors declared a three-for-one stock split of
our outstanding shares of common stock effected in the form of a stock dividend,
distributed on May 29, 2020 to stockholders of record on May 18, 2020. We
distributed two newly issued shares of common stock to holders of record of each
share of common stock to effect the stock split. All applicable share and
per-share amounts in this "Management's Discussion and Analysis of Financial
Condition and Results of Operations" have been retroactively adjusted to give
effect to this stock split.

Financial Highlights and COVID-19
[[Image Removed: ew10-qq220_chartx39428a18.jpg]][[Image Removed: ew10-qq220_chartx40915a18.jpg]]
In March 2020, the World Health Organization categorized the Coronavirus disease
2019 ("COVID-19") as a pandemic. COVID-19 continues to spread throughout the
United States and other countries across the world, and the duration and
severity of its effects are currently unknown. The global pandemic has adversely
impacted and is likely to further adversely impact nearly all aspects of our
business and markets, including our workforce and operations and the operations
of our customers, suppliers, and business partners. Our priority has been to
support our clinician partners, protect the well-being of our employees, and
maintain continuous access to our life-saving technologies while offering
front-line in-hospital support. Our manufacturing operations have continued to
respond to impacts related to COVID-19, and we have been able to supply our
technologies around the world. Across the organization, we are proactively
managing inventory, assessing alternative logistics options, and closely
monitoring the supply of components.

TAVR and Surgical procedure volumes varied greatly since the end of March 2020
by geography, and even by hospital, as patients and their physicians analyzed
the trade-off between aortic stenosis and their concern for COVID-19. In the
last few weeks of the first quarter of 2020, procedure volumes related to our
TAVR and Surgical products dropped significantly. In the second quarter of 2020,
procedure volumes began to improve as we progressed through the quarter. We also
started to

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progressively resume patient enrollment in clinical trials that were voluntarily
paused or slowed at the end of the first quarter of 2020, and we are working
with additional centers as many are now ready to re-engage. In Critical Care,
there was greater demand in Europe for our pressure monitoring products, but
demand for other Critical Care products began to decrease at the end of the
first quarter of 2020 due to COVID-19, and that trend continued through the
second quarter of 2020.

Despite the challenges associated with COVID-19, our net sales for the first six
months of 2020 were $2.1 billion, representing a decrease of $26.2 million over
the first six months of 2019. Sales growth of our TAVR products, primarily the
Edwards SAPIEN 3 Ultra valve, for the six months ended June 30, 2020 was not
enough to offset lower demand for our Surgical Structural Heart and Critical
Care products.

The decrease from the prior year period in our diluted earnings per share was
driven by an after-tax charge of $306.9 million in the second quarter of 2020 to
settle certain patent litigation related to transcatheter mitral and tricuspid
repair products.  For further information, see Notes 3 and 9 to the
"Consolidated Condensed Financial Statements."

We are closely monitoring the impact of COVID-19 on all aspects of our business
and geographies, including its impact on our customers, employees, suppliers,
vendors, business partners and distribution channels. The extent to which the
COVID-19 global pandemic impacts our business, results of operations, and
financial condition will depend on future developments, which are highly
uncertain and are difficult to predict; these developments include, but are not
limited to, the duration and spread of the outbreak, its severity, the actions
to contain the virus or address its impact, U.S. and foreign government actions
to respond to the reduction in global economic activity, and how quickly and to
what extent normal economic and operating conditions can resume. Even after the
COVID-19 outbreak has subsided, we may continue to experience materially adverse
impacts on our financial condition and results of operations.

Healthcare Environment, Opportunities, and Challenges



The medical technology industry is highly competitive and continues to evolve.
Our success is measured both by the development of innovative products and the
value we bring to our stakeholders. We are committed to developing new
technologies and providing innovative patient care, and we are committed to
defending our intellectual property in support of those developments. In the
first six months of 2020, we invested 18.0% of our net sales in research and
development.

New Accounting Standards

For information on new accounting standards, see Note 1 to the "Consolidated Condensed Financial Statements."



Results of Operations

Net Sales Trends
(dollars in millions)
                              Three Months Ended                                              Six Months Ended
                                    June 30,                                                       June 30,
                               2020             2019         Change     Percent Change        2020           2019        Change      Percent Change
United States            $    516.2          $   624.9     $ (108.7 )        (17.4 )%     $   1,183.6     $ 1,187.7     $  (4.1 )         (0.3 )%
Europe                        204.7              241.7        (37.0 )        (15.2 )%           454.0         476.4       (22.4 )         (4.7 )%
Japan                         106.8              113.1         (6.3 )         (5.5 )%           216.8         211.5         5.3            2.5  %
Rest of World                  97.3              107.2         (9.9 )         (9.5 )%           199.3         204.3        (5.0 )         (2.5 )%
International                 408.8              462.0        (53.2 )        (11.5 )%           870.1         892.2       (22.1 )         (2.5 )%
Total net sales          $    925.0          $ 1,086.9     $ (161.9 )        (14.9 )%     $   2,053.7     $ 2,079.9     $ (26.2 )         (1.3 )%



International net sales include the impact of foreign currency exchange rate
fluctuations. The impact of foreign currency exchange rate fluctuations on net
sales is not necessarily indicative of the impact on net income (loss) due to
the corresponding effect of foreign currency exchange rate fluctuations on
international manufacturing and operating costs, and our hedging activities.

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Net Sales by Product Group
(dollars in millions)
                               Three Months Ended                                              Six Months Ended
                                     June 30,                                                       June 30,
                                2020             2019         Change     Percent Change        2020           2019        Change     Percent Change
Transcatheter Aortic
Valve Replacement         $    594.3          $   677.7     $  (83.4 )        (12.3 )%     $   1,336.5     $ 1,275.4     $  61.1            4.8  %
Transcatheter Mitral and
Tricuspid Therapies              6.1                7.0         (0.9 )        (11.2 )%            16.6          11.3         5.3           47.6  %
Surgical Structural Heart      160.9              217.8        (56.9 )        (26.1 )%           354.3         432.5       (78.2 )        (18.1 )%
Critical Care                  163.7              184.4        (20.7 )        (11.3 )%           346.3         360.7       (14.4 )         (4.0 )%
Total net sales           $    925.0          $ 1,086.9     $ (161.9 )        (14.9 )%     $   2,053.7     $ 2,079.9     $ (26.2 )         (1.3 )%



Transcatheter Aortic Valve Replacement
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Net sales of TAVR products decreased for the three months ended June 30, 2020 as
patients and providers turned their focus to the COVID-19 pandemic. The decrease
in sales was driven by the Edwards SAPIEN 3 valve, particularly in the United
States and Europe, partially offset by higher sales of the Edwards SAPIEN 3
Ultra System following its regulatory approval in the United States (December
2018) and in Europe (November 2018). Our procedure volumes dropped significantly
beginning in March 2020 due to COVID-19, and began to steadily improve in May
and June 2020. For the six months ended June 30, 2020, increased sales of the
Edwards SAPIEN 3 Ultra System more than offset the decrease in SAPIEN 3 sales.

The launch of the Edwards SAPIEN 3 Ultra System continued to be very positive in
the first six months of 2020. In the first quarter of 2020, to ensure the safety
of our employees and clinician partners from the threat of COVID-19, we decided
to pause proctoring at centers that were not already trained on the Edwards
SAPIEN 3 Ultra System. In the second quarter of 2020, we resumed training.

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Transcatheter Mitral and Tricuspid Therapies
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Net sales of TMTT products decreased for the three months ended June 30, 2020 as
patients and providers turned their focus to the COVID-19 pandemic. The decrease
in sales was driven by the Edwards PASCAL transcatheter valve repair system
("PASCAL") in Europe, partially offset by increased sales of the Cardioband
system for tricuspid valve repair. Our procedure volumes for PASCAL dropped
significantly in April 2020 due to COVID-19, and began to improve in May and
June 2020. For the six months ended June 30, 2020, net sales of TMTT products
increased due primarily to sales in Europe of PASCAL, which received CE Mark in
February 2019, and the Cardioband system for tricuspid valve repair.

At the end of March 2020, we temporarily paused new enrollments in our active pivotal clinical trials of transcatheter mitral and tricuspid therapies in response to the COVID-19 response around the globe. In consultation with investigators and hospitals, more than half of our trial centers have been reactivated and are beginning to treat patients.


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Surgical Structural Heart
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Net sales of Surgical products decreased for the three and six months ended June
30, 2020 due primarily to decreased sales of aortic tissue valves, primarily in
the United States and Europe, due to the impact of COVID-19. The ongoing
adoption of TAVR also contributed to the decrease in United States surgical
aortic valve sales. These decreases were partially offset by increased sales of
the INSPIRIS RESILIA aortic valve, primarily in the United States and Japan.
Increased and improved management of intensive care unit capacity, as well as
prioritization of heart surgery in many hospitals, contributed to rebounding
procedure volumes late in the second quarter of 2020.

In Europe, our HARPOON Beating Heart Mitral Valve Repair System became available
commercially at the end of 2019, and the first commercial case was successfully
completed in Europe in the second quarter of 2020. In addition, we received
United States Food and Drug Administration approval in April 2020 to begin our
U.S. pivotal investigational device exemption study. HARPOON offers the
potential for earlier treatment of degenerative mitral valve disease, with
faster recovery and more consistent outcomes for surgical patients.


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Critical Care
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The decrease in net sales of Critical Care products was driven by our enhanced
surgical recovery products, primarily in the United States, as many surgical
procedures were delayed due to COVID-19. We also experienced a decline in orders
of our HemoSphere advanced monitoring platform in the United States as hospitals
limited their capital spending due to COVID-19. Foreign exchange rate
fluctuations decreased net sales for the three and six months ended June 30,
2020 by $3.3 million and $4.6 million, respectively, due to the weakening of
multiple currencies, primarily the Euro, against the United States dollar.

These decreases in net sales were partially offset by increased demand for our
pressure monitoring products, primarily in Europe. In addition, our sales for
the three and six months ended June 30, 2020 included $4.4 million and $10.1
million, respectively, related to CAS Medical Systems, Inc. ("CASMED"), which we
acquired on April 18, 2019. CASMED is a medical technology company dedicated to
non-invasive monitoring of tissue oxygenation in the brain.








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Gross Profit
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The increase in gross profit as a percentage of net sales for the three and six
months ended June 30, 2020 was driven primarily by:
•        the prior year charge of $46.2 million related to strategic decisions

regarding our transcatheter aortic valve portfolio, including the

decision to discontinue our CENTERA program;

partially offset by: • a 0.5 percentage point and 0.4 percentage point decrease, respectively,


         due to the impact of foreign currency exchange rate fluctuations,
         including the settlement of foreign currency hedging contracts; and

• incremental costs associated with COVID-19.





Selling, General, and Administrative ("SG&A") Expenses
[[Image Removed: ew10-qq220_chartx45302a18.jpg]]
The decrease in SG&A expenses for the three and six months ended June 30, 2020
was due to (1) decreased sales, marketing and travel-related expenses, primarily
in the United States, Europe and Japan, due to COVID-19, (2) decreased
personnel-related costs due to lower sales performance, and (3) the impact of
foreign currency, which decreased expenses by $4.3 million and $7.2 million,
respectively, due to the strengthening of the United States dollar against
multiple currencies, primarily the Euro. The decrease in SG&A for the six months
ended June 30, 2020 was due to the aforementioned decreases,

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partially offset by higher transcatheter structural heart field personnel-related costs, primarily in the United States and Europe, during the first three months of 2020.



Research and Development ("R&D") Expenses
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The decrease in R&D expenses for the three months ended June 30, 2020 was
primarily due to decreased spending on clinical trials as we paused certain
mitral and tricuspid active pivotal clinical trials due to COVID-19. The
increase in R&D expenses for the six months ended June 30, 2020 was primarily
due to investments in our transcatheter mitral and tricuspid therapies during
the first quarter of 2020, partially offset by the decreased spending on
clinical trials in the second quarter of 2020.

Change in Fair Value of Contingent Consideration Liabilities, net



The change in fair value of contingent consideration liabilities resulted in
expense of $19.6 million and $17.4 million for the three and six months ended
June 30, 2020, respectively, and $8.0 million and $14.7 million for the three
and six months ended June 30, 2019, respectively. The changes in fair value were
primarily driven by credit spreads (which increased during the first quarter of
2020 and decreased in the second quarter of 2020), partially offset by discount
rates (which decreased significantly in the first quarter of 2020) and the
accretion of interest due to the passage of time. The changes to the credit
spread and discount rate assumptions were primarily due to COVID-19. For further
information, see Note 6 to the "Consolidated Condensed Financial Statements."

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