Image source: NuVasive.

The intersection of technology and healthcare is an exciting place right now, with plenty of innovative solutions designed to treat medical problems and make lives better for the patients who suffer from them. Major healthcare companies like Johnson & Johnson (NYSE:JNJ) have seen less-than-stellar results from their medical-device lines, but NuVasive's(NASDAQ:NUVA) focus on minimally invasive spinal surgical procedures has gotten a positive reception from medical professionals, and coming into its third-quarter financial report on Tuesday, NuVasive shareholders hoped that the company would be able to sustain the pace of its growth and demonstrate that it has plenty of future potential.

NuVasive's results were quite encouraging, with earnings well in excess of what many investors were looking to see from the medical-device company. Let's take a closer look at how NuVasive did and whether it can sustain its growth trajectory into the future.

NuVasive still looks healthy
NuVasive's third-quarter results featured solid gains in core financial metrics. Revenue rose 5.6% to $200.5 million, which was nearly exactly in line with what most of those following the company had expected. The impact of NuVasive's success on the bottom line was more stunning, with adjusted net income of $18.1 million more than quadrupling the year-ago results, and adjusted earnings of $0.35 per share were a full $0.08 above the consensus forecast among investors.

Several aspects of NuVasive's performance contributed to its strong results. The most important was NuVasive's strategy toward expanding its margins, which boosted both operating margins and adjusted EBITDA margins by about five percentage points each. At the same time, NuVasive was also able to offset the downward impact of the strong dollar on its international business, with its reported revenue increase overcoming more than two percentage points of pressure from foreign-currency weakness.

In particular, reduced operating expenses were essential in driving net income growth. Even with expanding revenue, NuVasive cut its sales, marketing, and administrative costs by more than $2.3 million, and the company kept increases in research and development expenses in check. All told, NuVasive spent 2% less on operating expenses than it did during the year-earlier quarter.

CEO Greg Lucier expressed his pride in NuVasive's performance, noting that it "was driven by continued strength in the United States and robust growth in certain international geographies where NuVasive is leading with our competitive XLIF technology and differentiated offerings." Lucier is confident that the company will continue to benefit from its innovative spirit to make future advances in spinal treatment.

What's ahead for NuVasive?
The favorable results prompted NuVasive to increase some of its guidance for the full 2015 year. Although it still expects revenue to come in around $810 million, NuVasive raised its adjusted earnings guidance to $1.25 per share, $0.08 higher than its previous guidance, which exactly matches the extent to which it beat earnings in the third quarter. NuVasive has also gotten even more optimistic about its margin projections for the full year, adding a few tenths of a percentage point to its predictions for operating profit margins and adjusted EBITDA margins.

In the current environment, just about any growth is something that investors should celebrate. In its most recent quarter, Johnson & Johnson reported declines of more than 7% in its worldwide medical device sales, and even though foreign currency impacts dealt a much more dramatic eight percentage point blow to the segment's growth, even currency-neutral sales gains of 1% show just how challenging the industry is right now. By focusing on a particular area, NuVasive has done a good job of making the most of the opportunity it has chosen.

Going forward, NuVasive's biggest challenge will be to continue to gain a positive reputation among medical professionals and move forward with new innovations to improve its products further. As long as it can keep positive momentum, then NuVasive has the potential to give investors the long-term returns they'd like to see.