European MedTech "AI: Positive in aggregate, polarising in practice" Doyle

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European MedTech "AI: Positive in aggregate, polarising in practice" Doyle

Global Research

21 May 2026ab

European MedTech Equities

Europe including UKAI: Positive in aggregate, polarising in practice

Healthcare

Graham Doyle

AI benefits to start accruing just as multiple is at 10-year lows and EPS inflecting Analyst

Investors have been concerned that MedTech is at risk of AI disruption. However, our graham.doyle@ubs.com

five-stage framework shows that in aggregate it is positive - albeit there are winners and +44-20-7568 2587

losers, some of which may surprise investors. We see hearing aids as the biggest Kavya Deshpande

(arguably most surprising) beneficiary: AI enables a better economic model (preferred: Analyst

Demant). Elsewhere Human Bionics (preferred: Ottobock) and single-use endoscopy kavya.deshpande@ubs.com

(preferred: Ambu) should benefit. By contrast, we expect limited benefit in Imaging +44-20-7567 8515

(GEHC, PHIA, SHL), potentially disappointing bulls; while we think radiotherapy (leas Thyra Lee

preferred: Elekta) is exposed to potential negative disruption. Overall, we conclude Analyst

MedTech should modestly benefit from AI, meanwhile the sector is at 10 year P/E lows thyra.lee@ubs.com

just as EPS momentum inflects into H2 2026. We see this and November mid-term +44-20-7568 0083

elections in the US as potential catalysing events.

Our five-stage framework for assessing revenue disruption

We believe MedTech is likely to benefit from lower cost inflation due to AI; but think

investor concern is around revenue disruption. Here, our five-stage framework goes

subsector-by-subsector, identifying: 1) if AI/software now drives greater incremental

innovation than hardware; 2) if this software is captive to the hardware/its