Masimo (NASDAQ:MASI) gave investors nothing but good news when it reported its first-quarter results in May. The company, which specializes in noninvasive monitoring technology, posted solid revenue and earnings growth. It even upped its full-year 2019 guidance.

The company announced its second-quarter results after the market closed on Wednesday. Yet again, Masimo delivered plenty of good news. Here are the highlights from the company's second-quarter update.

Masimo systems in a hospital room.

Image source: Masimo.

Masimo results: The raw numbers

Metric

Q2 2019

Q2 2018

Change

Revenue

$229.7 million $211.6 million

8.5%

Net income 

$44.9 million $43.9 million

2.4%

Adjusted earnings per share (EPS)

$0.76 $0.61

24.6%

Data Source: Masimo.

What happened with Masimo this quarter?

Masimo achieved solid revenue growth despite its royalty and other revenue dropping from $9.6 million in the prior-year period to only $142,000 in the second quarter. The key to the company's success was higher product revenue of $229.5 million, up 13.6% year over year and an increase of 14.8% on a constant-currency basis.

The company's net income on a generally accepted accounting principles (GAAP) basis increased only modestly from the prior-year period. Masimo's higher profit margin in the second quarter was offset to some extent by higher operating costs.

While Masimo delivered much stronger adjusted EPS growth, it came with an asterisk. The primary reason for the higher adjusted EPS increase was a significant adjustment for royalty and other revenue in the prior-year period. Without it, Masimo's adjusted EPS would have declined year over year.

What management had to say

Masimo Chairman and CEO Joe Kiani stated:

The first half of 2019 has been strong with second-quarter constant currency product revenue growth of 14.8% and non-GAAP earnings-per-share growth of 25%. We are happy to report second-quarter results that once again exceeded expectations. Our breakthrough technologies and solutions improve patient outcomes and reduce cost of care. In the first half of the year, we introduced six important products, including Radius PPG, our Halo ION, and a neonatal version of our O3 Cerebral Oximetry monitor, all of which should help fuel our momentum. With these new products added to our existing portfolio and ever-increasing global footprint, we are delighted to be in a position to raise our revenue and earnings guidance for 2019.

Looking forward

Masimo boosted its full-year 2019 guidance for the second time this year. The company now expects total revenue of $926.3 million, with product revenue of $925 million. Masimo's previous guidance projected full-year total revenue of $919.1 million, with product revenue of $918 million.

The company also now anticipates full-year 2019 GAAP EPS of $3.30 and adjusted non-GAAP EPS of $3.15. Previously, Masimo looked for full-year GAAP EPS of $3.25 and adjusted non-GAAP EPS of $3.12.