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Zimmer Biomet revised its forecast for the impact of tariffs on the company this year, joining other medtech firms in making similar adjustments.

CFO Suketu Upadhyay informed investors on Thursday that the company now anticipates a roughly $40 million reduction in operating profit this year. In May, the company had projected an impact ranging from $60 million to $80 million.

This updated forecast reflects efforts to mitigate the effects on its business, as well as lower-than-expected overall tariff rates. Upadhyay noted that the forecast assumes China tariffs will stay at their current levels, though he added that the situation remains fluid.

Following the first-quarter earnings calls, where medtech companies had sometimes projected tariff impacts in the hundreds of millions, many have lowered their expectations in second-quarter calls. For instance, both Johnson & Johnson and Boston Scientific reduced their forecasts, cutting their total expected impacts by $200 million and $100 million, respectively.

Stryker, a competitor in orthopedics, made a more modest revision, lowering its expected charge to $175 million from $200 million.

The reduced tariff impact contributed to Zimmer’s decision to raise its guidance for adjusted earnings per share. The company now expects adjusted EPS to fall between $8.10 and $8.30 for the year, up from the previous range of $7.90 to $8.10.

Zimmer also narrowed its revenue forecast to a growth range of 6.7% to 7.7%, compared to its prior forecast of 5.7% to 8.2%.

Zimmer’s knee segment saw a modest recovery in the second quarter. After a year-over-year increase of 0.6% in Q1, the segment grew by just over 3% in Q2, generating $826 million in revenue. The international growth rate (4.8%) outpaced the U.S. growth rate (1.7%).

Despite questions regarding Zimmer’s position in the knee procedure market, CEO Ivan Tornos expressed optimism about the acceleration in the U.S. The knee business grew by 150 basis points quarter-over-quarter, with July showing a stronger growth rate.

“Things are going in the right direction — encouraged by, not satisfied,” Tornos said. “(We) want to get back to the days where we’re taking share each and every quarter. We do believe there’s a pathway there.”

Tornos highlighted that this pathway includes new product launches and technology innovations, such as autonomous robotics through the company’s proposed acquisition of Monogram Technologies, as well as investments in products like smart implants.

Zimmer’s hip segment also rebounded from sub-1% growth, posting a 5.8% year-over-year increase in Q2, reaching $536.1 million, compared to a 0.9% growth rate in Q1.