TransMedics Group, Inc. Q1 FY2026 earnings call

Strategic investment in growth initiatives such as advancing heart and lung franchises, developing OCS kidney platform, upgrading devices to Gen 3.0 platform, unveiling CHOPS system, and expanding into international markets. Strong 1Q2026 financial performance with revenue growth. Detailed updates on strategic initiatives including CHOPS introduction, Europe NOP strategy, OCS Kidney Program, and Gen 3.0 upgrade. Focus on long-term value creation with continued investment across growth pillars.

Total revenue for 1Q2026 was $174 million, representing approximately 21% growth year over year and approximately 8% sequential growth from 4Q2025. U.S. transplant product revenue grew by 22% year-over-year and approximately 7% sequentially to $102 million, while OUS transplant revenue grew approximately 39% year-over-year and approximately 17% sequentially to $6 million. Adjusted operating profit was approximately $18.1 million in Q1, representing approximately 10.4% of total revenue in 1Q. Transplant logistics services revenue for 1Q2026 was approximately $32 million, up from $26.1 million in 1Q2025, representing approximately 22% year-over-year growth, and up from $28.6 million in 4Q2025, representing approximately 12% sequential growth.

Reiterates full year 2026 revenue guidance of $727 million to $757 million, representing 20% to 25% growth over 2025. Expect long-term gross margin profile around 60%, with near-term pressure due to investment but confidence in long-term profitability through initiatives like Kidney Program and Next Generation OCS.

Transient negative impact of U.S. Transplant Modernization Act on OPO performance and donor numbers. Potential impact of fuel prices on logistics costs. Competitive dynamics affecting clinical trials and market share.

Q: Regarding CHOPs, strategy, cannibalization, and organ target.

A: CHOPS is additive, not cannibalizing, focused on short transport runs. Goal on heart and lungs first.

Q: On enhanced programs and CHOPs in trials.

A: Enhance designed for specific goals, CHOPS elevates control arm game.

Q: On market challenges in second quarter.

A: Donor numbers below expectation, but expected to reverse.

Q: On IDE approval timing for trials.

A: Plan to file IDE supplement within next few weeks, expect approval and implementation in early Q3 2026.

Q: On operating margin guidance.

A: Expect operating margin below last year initially with investment plan to materialize.