Jan 4, 2001
Guidant Pre-Announces Fourth Quarter Revenues and Impact on Earnings Per Share

Indianapolis, Ind. - Guidant Corporation (NYSE and PCX: GDT), a world leader in the medical technology industry, announced fourth quarter revenues of approximately $649 million, reflecting sales growth of 13 percent versus the fourth quarter of 1999. On a constant currency basis, sales would have totaled nearly $670 million, growing 16 percent versus the prior year. Fourth quarter revenues are below analysts' estimates and on the basis of the revenue shortfall, the company expects a negative impact on earnings per share of between two and three cents.

In commenting on the quarter's performance, Ronald W. Dollens, Guidant president and chief executive officer, stated, "The fourth quarter reflects double-digit growth and our highest growth quarter of the year." Dollens continued, "We believe our core markets continue to be strong and Guidant is well positioned to grow revenue in 2001."

"The MULTI-LINK TETRA(tm) coronary stent system, launched in the U.S. in early October, has gained considerable market share during the fourth quarter. We believe our leadership position is secure, and we estimate that TETRA exited the quarter at a market share that is roughly twice that of our nearest competitor," commented Dollens. "Our sales of vascular intervention products in the U.S. grew in double-digits over the prior year, demonstrating the resurgence of our balloon dilatation catheter and coronary stent business."

Revenue growth from implantable defibrillators in the U.S. was 22 percent versus the prior year on the strength of the VENTAK® PRIZM(tm) 2 implantable cardioverter defibrillator system launched in mid-November. Higher revenue growth was limited by supply constraints early in the launch, which have now been largely alleviated. Dollens said, "Despite the early inventory challenges, we look forward to enhanced revenue growth from the PRIZM 2 product family as we enter 2001." Dollens continued, "Regarding pacemakers, our sales growth in the U.S. was 9 percent, which exceeded market growth estimates."

"Looking forward, we believe that Guidant is well positioned to deliver sales growth in the low-to-mid teens and earnings growth in the mid-to-high teens for the year 2001. We believe the current "Street" consensus earnings estimate for 2001 is reasonable and is within our planned range," commented Dollens. "New growth opportunities in the second half of the year, fueled by expected heart failure and intravascular radiation product approvals in the U.S., reflect some of the largest and most dynamic market opportunities we've seen in a long time. We look forward to these new opportunities to serve our patient and clinical customers in the coming year," he continued.

Guidant will conduct a live webcast regarding this pre-announcement tomorrow, January 5, at 8:30 a.m. EST. The webcast of Guidant's conference call will be accessible to all investors on the Guidant website or at StreetFusion.com. The webcast will be archived on both websites for future on-demand replay.

System requirements for the webcast include Internet Explorer 5.0 (or higher) or Netscape Navigator 4.0 (or higher). Users also should have the most recent version of Windows Media Player, which can be downloaded for free. Users may experience varying levels of performance based on their connection speed, system capabilities and presence of a corporate firewall. To ensure a connection, users should go to the program five to 15 minutes before its start.

The company will release full results for the fourth quarter on January 30 after the close of the New York Stock Exchange.

A global leader in the medical technology industry, Guidant Corporation provides innovative, minimally invasive and cost-effective products and services for the treatment of cardiovascular and vascular disease.

This release contains forward-looking statements about the company's future financial results, the company's prospects and products in research and development. This information is based upon management's current expectations, but actual results may differ materially from those discussed in the forward-looking statements. Factors affecting future results include those outlined in Exhibit 99.1 to the company's Form 10-Q filed November 2000.