EMBC

• Owen Mumford Acquisition and Integration

  • Closed May 15, 2026, two weeks earlier than originally planned, with integration progressing on schedule. The acquisition adds 3 manufacturing facilities (2 in the UK, 1 in Malaysia) and 1 U.S. warehousing center, expanding manufacturing options, enabling future network optimization, and strengthening emerging market presence.
  • Broadens Embecta's portfolio beyond legacy insulin injection devices to include a pharmaceutical services business with the next-generation ADAPTA adaptive platform auto-injector, plus additional medical devices for point-of-care testing and self-injection.
  • ADAPTA is a single-form-factor auto-injector that supports both 1mL and 2.25mL fill volumes, enabling simplified manufacturing, reduced changeovers, and streamlined supply chains. The total addressable auto-injector market is ~$2.4 billion, growing at a double-digit CAGR, and ADAPTA is currently supporting partner clinical development programs with secured long-term commercial agreements already in place.
  • A new dedicated Pharma Services organization was formed under newly appointed President Jeff Mann (who retains his role as Chief Legal Officer), combining Embecta and Owen Mumford talent to focus on this new growth platform.

• Core Business Progress

  • Market-appropriate pen needles are progressing through U.S. FDA review and BSI CE mark review for Europe. Market-appropriate syringes are already launched in China and will launch in additional countries in the coming months.
  • Global brand transition to the Embecta label is 90% complete as of Q3, and remains on track to be substantially finished by the end of calendar 2026.
  • A new commercial leadership change: Nimish Muzumdar joined as SVP and President, North America, bringing 25+ years of commercial experience in the pharma space. His initial assessment has identified opportunities to improve commercial execution through stronger customer partnerships, data-driven decision making, and better alignment with evolving customer needs.

• Product Portfolio Expansion

  • Co-packaging partnerships for generic GLP-1 therapies that include Embecta pen needles have launched in India, Canada, Brazil, and most recently South Africa.
  • A new small-pack pen needle format for patients using the recently launched ZebBound pen injector will launch in the U.S. in the coming months, following successful launches in Canada and Australia.

• Financial and Capital Updates

  • The company borrowed $180 million under its revolving credit facility to fund the acquisition, then repaid $53 million in debt during the quarter, maintaining a commitment to disciplined deleveraging. $9 million in capital was returned to shareholders via share repurchases in Q3.
  • Following quarter end, the revolving credit facility was amended and extended through December 30, 2028. As of Q3, the last 12 months net leverage was 3.7x, well below the 4.75x maximum covenant requirement.

• Full-year 2026 as-reported revenue guidance is maintained at $1.15 billion to $1.35 billion, representing a 4.2% to 6.1% YoY decline. Adjusted organic constant currency guidance is unchanged at the low end, with the high end slightly lowered due to U.S. customer and payer mix assumptions, partially offset by improved international performance expectations.
• Foreign currency is now expected to provide a 1.3% revenue tailwind, compared to the prior 1.5% tailwind expectation. Revenue contribution from Owen Mumford is now higher than prior guidance due to the earlier-than-expected closing of the acquisition.
• Adjusted operating margin guidance is raised to 23.5% to 24%, up from the prior range of 22.25% to 23.25%. The improvement reflects realized benefits from ongoing cost structure optimization and operating expense control initiatives, which are expected to deliver additional annualized benefits in 2027.
• Adjusted earnings per share guidance is raised to $1.80 to $1.90, up from the prior range of $1.55 to $1.75. The upgrade reflects cost optimization efforts, a lower expected adjusted tax rate of 27% (down from 28% previously), a lower expected interest expense of $95 million (down from $97 million previously), and a lower diluted share count of 58.6 million (down from 59.4 million previously) due to completed share repurchases.
• The company maintains its prior full-year 2026 free cash flow guidance of ~$100 million, which includes $18 to $20 million in capital expenditures, most of which will occur in Q4 2026.
• The company expects to repay at least $150 million of debt in full-year 2026; $128 million of debt has already been repaid in the first nine months of the year.
• Management plans to update the company's long-range plan (LRP) towards the end of calendar 2027, after current key strategic initiatives progress further.

Total company revenue for Q3 2026 was $272 million, an 8.1% year-over-year (YoY) decline on an as-reported basis and an 8.9% decline on an adjusted constant currency basis. Sequentially compared to Q2 2026, total revenue increased $50 million, GAAP operating income increased $14 million, and adjusted operating income increased $21 million.

• U.S. Segment: Q3 2026 revenue totaled $121 million, a 24.6% YoY decline on both reported and adjusted constant currency bases. Sequentially, U.S. revenue increased $25 million compared to Q2 2026, driven by normalized distributor order timing and an early contribution from the Owen Mumford acquisition. The U.S. segment contributed 44.5% of total Q3 2026 revenue.
• International Segment: Q3 2026 revenue totaled $151 million, an 11.5% YoY increase on a reported basis and a 9.7% increase on an adjusted constant currency basis. YoY growth was driven by strength in Latin America and Asia, plus the Owen Mumford contribution, partially offset by softness in China. The international segment contributed 55.5% of total Q3 2026 revenue.

By product family (adjusted constant currency):

• Pen Needles: Revenue declined 18.6% YoY, primarily driven by U.S. market pressures.
• Syringes: Revenue was roughly flat YoY, as U.S. declines from the long-term shift to insulin pens were offset by strong international performance in Latin America and Asia.
• Safety Products: Delivered 4.6% YoY growth, driven by gains in the U.S.
• Contract Manufacturing (for Becton Dickinson): Revenue declined 3.6% YoY, consistent with BD's ongoing insourcing of these products.

GAAP gross profit was $153.3 million (56.4% margin), compared to $197.1 million (66.7% margin) YoY. Adjusted gross profit was $158 million (58.2% margin), compared to $198.6 million (67.2% margin) YoY. GAAP operating income was $48.7 million (17.9% margin), compared to $94 million (31.8% margin) YoY. Adjusted operating income was $69.4 million (25.5% margin), compared to $109.1 million (36.9% margin) YoY. GAAP net income was $21.1 million ($0.36 diluted EPS), compared to $45.5 million ($0.78 diluted EPS) YoY. Adjusted net income was $32.6 million ($0.56 diluted EPS), compared to $65.5 million ($1.12 diluted EPS) YoY.

• Persistent U.S. market headwinds include: ongoing pressure from low-cost competitors, unfavorable customer and payer mix impacting net pricing, year-over-year declines in total insulin pen retail prescriptions, and macro demographic shifts including changing enrollment trends in ACA marketplaces and Medicaid that impact the insured population mix.
• Accelerated adoption of GLP-1 weight loss therapies may continue to impact legacy insulin product market volume.
• Ongoing softness in the China market continues to offset some international growth.
• Contract manufacturing revenue will continue to decline as Becton Dickinson insources these products per existing plans.
• All forward-looking statements are subject to inherent uncertainty, and actual results may differ materially from guidance due to unforeseen changes in market conditions, macro factors, and regulatory timelines for new product approvals.

Q: An analyst asked for an update on competitive pressures from low-cost regional players and Embecta's strategy to offset these headwinds. / A: Management stated that market share performance was in line with expectations set last quarter, with share stability achieved in Q3. Progress on new market-appropriate pen needles and syringes, designed to compete with low-cost offerings, is on track: pen needles are undergoing review with the FDA and BSI, while syringes have already launched in China, with expansion to additional global markets planned over time. (298 characters)

Q: An analyst asked for an update on U.S. market volume trends, specifically the impact of macro insurance trends and GLP-1 adoption, and whether these headwinds are continuing or improving. / A: Management confirmed that year-over-year decline in insulin pen total prescriptions was slightly greater in Q3 than in Q2, but the decline was within the expected range of variability, and sequential volume stabilized in Q3. Guidance assumes no further recovery or deterioration of these macro trends, which will continue to be monitored closely. (312 characters)

Q: An analyst asked for context around the reiterated full-year revenue guidance, which implies a lower Q4 revenue than street expectations, despite a Q3 beat. / A: Management noted that all current performance (Owen Mumford contribution, U.S. results, and international strength) is tracking within the range of expectations laid out 90 days prior. Management stated it was prudent to maintain the original guidance range and focus on continued execution through Q4. (274 characters)

Q: An analyst asked for preliminary thoughts on 2027 revenue growth and an updated long-range plan timeline. / A: Management declined to provide 2027 guidance, stating it will wait for 2026 to conclude and for current macro headwinds to stabilize before issuing new forecasts. The long-range plan update is scheduled for the end of calendar 2027, to allow time for new product, GLP-1 opportunity, and Owen Mumford initiative progress. (291 characters)

Q: An analyst asked about capital allocation priorities post-Owen Mumford acquisition, and the ADAPTA revenue contribution timeline. / A: Management confirmed that the primary capital allocation priority going forward is continued debt reduction, and the company has already outperformed earlier debt repayment expectations. ADAPTA integration and development is on schedule, but management will not release specific revenue projections until program development progresses further. (287 characters)