Globus Medical, Inc. Q1 FY2026 earnings call

Keith Feil mentioned first quarter results show ongoing focus on scaling, capturing share, and margin expansion. Trailing 12-month revenue more than tripled, free cash flow six times, debt extinguished, shares repurchased, and over 30 new products launched. Kyle Klein discussed first quarter results including sales growth, margin expansion, NEVRO's revenue contribution and impact, and R&D, SG&A, and other expense details. Operationally, focus on manufacturing and supply chain initiatives for margin improvement. Product development focus on procedure enabling with integration of imaging, navigation, robotics, etc.

Q1 revenue totaled $759.9 million, growing 27% as reported and 25.5% on a constant currency basis. Fully diluted non-GAAP earnings per share was $1.12, growing 64.7% over the prior year quarter. Base business revenue totaled $677.2 million, led by U.S. spine strength. US Spine grew 10% in Q1, marking third consecutive quarter of 10% growth. Enabling Technologies posted revenue of $26.9 million, growing 21% over prior year quarter. International spine business grew 16.4% as reported and 9.8% on constant currency basis. Trauma business grew 30.4% over prior year quarter. NEVRO revenue finished at $82.7 million.

Globus Medical reaffirms full year 2026 revenue guidance of $3.18 to $3.22 billion and increases non-GAAP fully diluted earnings per share guidance to $4.70 to $4.80 from $4.40 to $4.50. The upward revision reflects margin expansion seen in Q1 and expected favorable impact on full year results.

Q: On guidance and incremental headwinds to revenue, A: Reiterated confidence in guidance, noted expected lumpiness in Nevro revenue.

Q: On strategy and strong Q1 results, A: Slightly altering enabling tech approach to drive implant and procedure pull-through.

Q: On mid-70s gross margin target timeline, A: Consistent step forwards in adjusted gross profit margin expected, with supply chain initiatives aiding.

Q: On EPS upside and top line guidance, A: Top line guidance not raised due to early year, enabling tech strategy change, and Nevro lumpiness; EPS upside from gross margin expansion and synergy actions.

Q: On robot demand and competitive landscape, A: Healthy pipeline with higher mix of leases and rentals, Excelsius well positioned against competitors.

Q: On enabling tech strategy shift and NEVRO impact, A: Enabling tech pipeline with more rentals and leases, NEVRO not impacted by CMS pilot program yet.

Q: On NEVRO comparison and future, A: No Q1 2025 NEVRO numbers provided, expect Nevro to get worse before better.

Q: On gross margin opportunity and competitive rep hiring, A: Gross margin opportunity from cost and price, competitive rep program focuses on adding quality reps.

Q: On geopolitical risks and ORSO/eFlex, A: No material geopolitical risk impact, no comments on ORSO/eFlex progress.

Q: On revenue cadence and OUS Spine, A: Revenue cadence typical historical norms, OUS Spine growth expected to continue in low double-digit range.

Q: On U.S. spine growth source, A: Majority of U.S. spine growth from market share gains.

Q: On enabling technology evolution and weather/Kaiser strike, A: Enabling tech evolution on software refinement, small impact from weather/Kaiser strike.