OFIX

Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 8:30 a.m. ET Chief IR and Communications Officer - Julie Dewey President and Chief Executive Officer - Massimo Calafiore Chief Financial Officer - Julie Andrews Operator: Thank you for standing by. At this time, I would like to welcome everyone to the Orthofix Second Quarter 2026 Earnings Call. [Operator Instructions] I would now like to turn the call over to Julie Dewey. Julie Dewey: Thank you, and good morning, everyone. Welcome to Orthofix's Second Quarter 2026 Earnings Call. I'm Julie Dewey, Orthofix's Chief IR and Communications Officer. Joining me today are President and Chief Executive Officer, Massimo Calafiore; and Chief Financial Officer, Julie Andrews. Earlier today, Orthofix released its financial results for the second quarter ended June 30, 2026. A copy of the press release and supplemental presentation are available on our Investor Relations website, and a replay of this call will be posted shortly after we conclude. Before we begin, please note that our remarks include forward-looking statements. These statements involve risks and uncertainties, and actual results may differ materially. All statements other than those of historical facts are forward-looking statements. We do not undertake any obligation to revise or update such forward-looking statements. Factors that could cause actual results to differ materially are discussed in our most recent filings with the SEC and may be included in our future filings with the SEC. We will also reference certain non-GAAP financial measures during today's call, including certain growth rates presented on a pro forma constant currency basis and excluding discontinued M6 artificial disc product lines. Reconciliations to the most directly comparable U.S. GAAP measures and additional information are included in our press release and supplemental materials. Here's today's agenda. Massimo will start with business performance and operational highlights. Julie Andrews will follow with our financial results and guidance, then we'll open the call for Q&A. With that, I'll turn the call over to Massimo to discuss our second quarter performance and the progress we're making across our strategic priorities. Massimo? Massimo Calafiore: Thank you, Julie, and good morning, everyone. I appreciate you joining us today. Our second quarter results provide further evidence that the operational actions we have taken over the past year are showing up more clearly in the business. While that progress is encouraging, our transformation remains a work in progress, and we are staying disciplined in how we evaluate growth quality, commercial productivity, and returns. We delivered 5% pro forma constant currency net sales growth over prior year and saw encouraging trends across several areas of the portfolio, including double-digit growth in Global Limb Reconstruction and Spine Fixation, sequential momentum in Biologics, and the restoration of Medicare reimbursement for bone growth stimulators, which removes a meaningful headwind for our Therapeutic Solutions business as we enter the second half of the year. While we recognize that transformations are rarely linear and not every part of the portfolio will improve at the same pace, we believe Orthofix today is operating from a stronger position than it was a year ago. Our approach remains disciplined and focused. We believe the underlying drivers of our performance are becoming more constructive, supported by clearer execution priorities and better visibility in key parts of the business. With that context, let me walk through our business performance in Q2, starting with Spine. In Spine, Global Spine Fixation net sales grew 10% on a constant currency basis, with U.S. Spine Fixation net sales up 3% in the quarter. Our top 30 distributors, who represent approximately 80% of our Spine Fixation sales, continued to perform well. At the same time, we saw a steeper decline across the remaining smaller distributors, where productivity has been below our expectation for several quarters. We are actively evaluating where we can generate the best long-term returns among this group. As part of the process, we are being disciplined about where we invest resources and where we make choices to consolidate or exit relationships that are not delivering sustainable growth. This approach reflects our focus on profitable growth and strong returns. We expect these challenges with our smaller distributors to continue through the balance of the year. Longer term, our objective is to build a higher quality, more productive distributor network that can support sustainable growth, stronger adoption of new products, and better returns on future commercial investment. We are also preparing to bring new innovation into the channel. We completed our first clinical cases with our VIRATA minimally invasive system in Q2 and are continuing to prepare for the full market launch of our VIRATA Spinal Implant System later in the fourth quarter. Importantly, the initial surgeon feedback has been encouraging and supports our continued focus on building an integrated procedural platform that combines VIRATA with our interbody solution, surgical access technology, and 7D Enabling Technologies portfolio. Beyond spine, we believe early signs indicate that our focused execution is contributing to better performance in areas that have been under pressure. In Biologics, we saw encouraging signs that the business is moving in the right direction. Net sales were approximately flat year-over-year, representing a marked improvement from the contraction we experienced through 2025. This was the second consecutive quarter of improved year-over-year performance, moving from double-digit declines last year to approximately flat performance in Q2. While we are encouraged by this progress, we believe more consistency is needed before declaring a sustained return to growth. Our priority now is converting this more constructive trajectory into durable growth, supported by stronger account engagement, higher utilization, and targeted commercial focus around key products such as OsteoCove bioactive synthetic bone graft. To further support the long-term growth potential of the business, we are pairing improved commercial execution with targeted investment in clinical evidence generation for OsteoCove and Virtuos and product registry for Strand Plus. This investment is intended to support a more durable recovery. We saw a different but equally important dynamic in Therapeutic Solutions, where underlying demand remained resilient despite the reimbursement pressure that affected part of the quarter. Therapeutic Solutions, formerly Bone Growth Therapies, delivered 3% year-over-year net sales growth despite the impact from the Medicare reimbursement decrease that was in effect for a portion of the second quarter. That performance reinforces the durability of the franchise, which continued to benefit from steady demand, a strong margin profile, and favorable cash generation characteristics. We were also pleased that CMS restored Medicare reimbursement for bone growth stimulators to its prior level following stakeholder feedback, including concerns we raised. This decision removes a meaningful headwind and supports improved second half visibility, with utilization and prescribing trends during the quarter remaining constructive. As we return to a more supportive reimbursement environment, we plan to continue investing in elevating the patient and physician experience within the Therapeutic Solutions franchise. During the quarter, we launched AccelStim 2.0. This award-winning bone growth therapy device was redesigned with a streamlined form factor to provide enhanced ease of use. It is now compatible with our STIM onTrack mobile app and STIM MD physician platform, giving patients and physicians greater visibility into device utilization and therapy progression, further strengthening the value proposition of the franchise. We view Therapeutic Solutions as more than a highly profitable franchise. Its established physician and patient reach provides a valuable channel for evaluating adjacent growth opportunities where we see clear clinical relevance and attractive returns. Global Limb Reconstruction demonstrated solid performance during the quarter, supported by strong international momentum and sustained demand across key product families. Net sales grew 11% on a constant currency basis, led by the TrueLok Elevate, and FITBONE. In the U.S., growth was below our expectation, but the primary dynamic was not a lack of clinical interest. Rather, we are still building the commercial infrastructure required to more consistently convert this interest into revenue in what remains an emerging limb reconstruction market. Our focus is on improving distributor productivity, expanding market development activities, and increasing commercial consistency. As those capabilities mature, we expect U.S. performance to become more consistent over time. We also see opportunities to extend our limb reconstruction expertise into adjacent areas of unmet clinical need. One example is diabetic foot ulcers, a large and underserved market where we believe our core technologies may have broader clinical applications. Our near-term focus is on generating the clinical evidence needed to support a potential expanded indication while maintaining a disciplined approach to investment and development. We view this as an important pipeline opportunity that could expand the reach of our Limb Reconstruction portfolio and support durable long-term growth. To recap, Q2 showed tangible progress in several areas of the business, while also reinforcing where continued execution is required. Our focus remains on improving quality of revenue, strengthening commercial productivity, and building a more consistent path to profitability and cash generation. Just as importantly, we believe the combination of focused innovation, a more productive commercial organization, and disciplined capital allocation positions us to create sustainable long-term value for shareholders. With that, I'll turn the call over to Julie Andrews to review our financial results and guidance. Julie Andrews: Thank you, Massimo, and good morning. For purposes of consistency, the growth rates I'll reference today are on a pro forma constant currency basis and exclude the impact from discontinued M6 product lines. From a financial perspective, Q2 results reflected improving revenue trends across several areas of the portfolio, while profitability was impacted by geographic mix and continued investment in priority growth initiatives. Let me briefly review performance by business segment. Global Spinal Implants, Biologics and Enabling Technologies generated $109 million in net sales, an increase of 4% versus the prior year period. Growth was led by Spine Fixation, which benefited from continued international momentum and timing of international distributor orders. Therapeutic Solutions generated $64.2 million in net sales, up 3% year-over-year. The business grew despite temporary reimbursement pressure, reinforcing our view that underlying demand remains resilient. With Medicare reimbursement restored, we expect Therapeutic Solutions to contribute more favorably in the second half. Global Limb Reconstruction delivered net sales of $37.7 million in the second quarter, an increase of 11%. Growth was driven by strong international demand and continued adoption of key product families, including TrueLok Elevate and FITBONE. While growth in the U.S. was more modest during the quarter, our second half assumptions reflect greater commercial productivity, the lapping of sunsetting product lines, and continued prioritization of our highest return growth opportunities. Moving down the P&L. Non-GAAP adjusted gross margin was 71.7%, reflecting an unfavorable geography mix during the quarter. Adjusted EBITDA was $20.1 million. While net sales trends improved during the quarter, profitability was impacted by geographic mix, credit losses in certain international markets, and continued investment in key launches, partially offset by ongoing cost optimization initiatives. We remain confident that the resource alignment and cost actions underway will support our full year profitability outlook. We ended the quarter with $104.4 million in total cash, including restricted cash, providing us with flexibility to support both our operating priorities and strategic investments. Before turning to guidance, I want to provide context around our European MDR strategy for spine that is reflected in our updated net sales outlook and is important to understand and model appropriately. As background, SeaSpine made the decision in 2022 to exit the European spine market and focus resources on the U.S., and that strategy remains in place following the merger. Accordingly, we had not been pursuing MDR compliance for the Spine portfolio. More recently, one of our largest European distributors expressed strong interest in continuing to sell some of our spine products in its territory. We entered into a strategic contractual arrangement under which the distributor is funding our MDR certification-related work required to support continued market access for these spine products. This allows us to preserve a targeted opportunity in Europe, while maintaining our disciplined investment priorities. To support this arrangement, the distributor intends to purchase sufficient inventory in 2026 to maintain continuity of supply and ensure continued market access while MDR certification and related country-specific market access requirements are completed. These purchases are included in our updated 2026 net sales outlook. The key takeaway is that we expect this arrangement to contribute approximately $15 million of incremental net sales in 2026, with the majority expected to be recognized in Q4. We are calling this out explicitly because it would be a discrete timing benefit and to be distinguished from the underlying run rate performance of the business. As a result, the arrangement is also expected to create an approximately $22 million net sales headwind in 2027, while MDR requirements are completed. Let me now turn to our updated full year outlook. Again, all measures are provided on a non-GAAP pro forma basis, are based on current foreign currency exchange rates, and do not contemplate any additional exchange rate changes during the remainder of the year. We now expect full year 2026 net sales in the range of $845 million to $855 million, representing approximately 5% pro forma constant currency growth at the midpoint and an increase of approximately $7 million from the outlook we provided in May. The updated outlook reflects underlying business trends plus several discrete factors that are shaping our expectations for the balance of the year. First, Medicare reimbursement for bone growth stimulators has been restored to its prior level retroactive to May 18, 2026. Second, our strategic arrangement with our European distributor contributes revenue associated with inventory purchases tied to the MDR transition. Third, we are seeing encouraging trends across several areas of the business, including stabilization in Biologics and continued strength in portions of Limb Reconstruction. And fourth, those positives are offset by ongoing softness among smaller U.S. spine distributors whose performance remains below our expectations and is reflected in our outlook for the balance of the year. We are increasing our adjusted EBITDA guidance range to $95 million to $98 million. While the MDR-related distributor revenue carries a different margin and timing profile than our core revenue, the restoration of Medicare reimbursement, ongoing cost actions, and continued operational progress returns our profitability outlook to the level we expected before the Medicare reimbursement reduction was introduced in May. Our focus remains on balancing net sales growth, profitability, and cash generation as we execute against our long-term value creation priorities. As you think about the second half, we expect third quarter net sales to generally be consistent with Q2 as reimbursement restoration and improving trends in several businesses are expected to be largely offset by ongoing softness among smaller U.S. spine distributors. Looking to the fourth quarter, sequential growth is expected to be driven by the timing of inventory purchases associated with the European distributor arrangement and normal seasonality. We currently expect the majority of the approximately $15 million 2026 net sales benefit to be recognized in Q4. I also want to note that the European distributor arrangement creates a temporary free cash flow timing headwind in 2026, as some cash receipts are projected to occur in 2027, while inventory-related cash outflows occur this year. Importantly, this timing dynamic does not change our view of the underlying cash-generating potential of the business or the quality of earnings reflected in our outlook. Taken together, we believe our updated outlook reflects more favorable performance indicators in key areas of the business, balanced by the timing of the MDR-related net sales benefit and the continued softness among smaller U.S. spine distributors. We remain focused on improving growth quality, expanding profitability, and strengthening cash generation. Now let me turn it back to Massimo for closing remarks. Massimo? Massimo Calafiore: Thank you, Julie. Q2 was an important proof point in our transformation. We made progress in several parts of the business, but we remain focused on consistent execution, disciplined investment, and improving the quality of our growth. We believe Orthofix is entering the second half with greater clarity, more favorable trends across several businesses, and a focused approach to driving profitable growth and cash generation. Our priorities remain clear: improving commercial productivity, advancing differentiated innovation, and generating the clinical evidence needed to support future growth opportunities. Our objective is not growth at any cost. It is durable, profitable growth, supported by better commercial productivity, disciplined investment, and stronger business fundamentals. Before we take your questions, I want to thank our team members and commercial partners around the world for their continued commitment and execution. With that, let's open the call for questions. Operator: [Operator Instructions] And your first question comes from the line of Caitlin Roberts with Canaccord Genuity. Caitlin Cronin: I guess just to start on guidance. You increased the guidance again, but not as much as prior to the CMS changes. Maybe some more color on what's changed since that time, whether that's the partial quarter impact of the pricing change or if there's more in there from possibly the small spine distributor challenges? Any color on that would be great. Julie Andrews: Yes. Thanks, Caitlin. So the updated outlook reflects a combination of underlying business trends and several discrete factors that are shaping our expectations for the balance of the year. So first, on the positive side, we have the restoration of the Medicare reimbursement, which is approximately a $12 million benefit, as well as the European distributor arrangement, which is expected to contribute approximately $15 million of incremental net sales in 2026. We're also seeing stabilization across and encouraging trends across several areas of the business, including Biologics and portions of our Limb Reconstruction business. At the same time, those factors are being offset by the ongoing softness among our smaller U.S. spine distributors where performance remains below our expectations, and that's reflected in our outlook for the balance of the year. And we believe it was important to be transparent about both the progress we're seeing and the execution risk that remains. And those are the factors that are influencing our reset of our guidance. Massimo Calafiore: Yes. And like every transformation, it is not always linear, and we didn't change our main thesis to be very disciplined on prioritizing quality revenue. So what we see, the softness on this 20% of our smaller distributors is not related to demand, it's really related to the spine channel. And we didn't feel to change how we operate in the business. But at the same time, I think that it is very important to highlight the fact that we are maintaining our EBITDA target. At the same time, we are doubling down on innovation. I'm sure that you heard about our investment that we're making in Biologics. Biologics is recovering very well. We strongly believe in our product and investing in clinical evidence for OsteoCove, Virtuos, and starting a big registry for Strand Plus. In orthopedics, we see a great opportunity with the diabetic foot ulcer, and we just submitted our IDE to the FDA, and we are waiting for their feedback. All of this to open up a very great and potentially very lucrative opportunity for the organization. Caitlin Cronin: Understood. And then just any thoughts on reinstating an LRP now with the pricing decision reversed and the guidance for this year increased? Julie Andrews: Yes. I think we're still assessing where we are and looking at our actions, particularly related to the smaller spine distributors and how that may impact our LRP over the next year or so. Operator: [Operator Instructions] And your next question comes from the line of Tom Stephan with Stifel. Thomas Stephan: I wanted to start off on the Europe MDR kind of distributor order dynamic and sort of core growth. So basically, as we think about apples-to-apples guidance on revenue compared to your previous outlook, we should be taking off that $15 million of sales that were not previously there. Like that's incremental. Is that correct as we're trying to get to sort of core growth? I guess to start, Julie, do I have that correct? Julie Andrews: Yes. Thomas Stephan: Okay. Got it. And so if we take out the $15 million tailwind in the back half, I mean, by my math, that would imply core growth on revenue of 1% to 2% in the second half. Hopefully, I have that right as well. So Julie or Massimo, why would growth slow to those levels in the core business, just given 1H and 2Q were kind of in that mid-single-digit range on a pro forma constant currency basis? And then I'll have a couple of follow-ups. Julie Andrews: Yes, Tom. So I think when you're looking at it, I think you're in the range, 2% to 3%-ish core growth rate. Again, I think if you look at our smaller U.S. spine distributors, we're seeing a decrease or weakening there beyond what was our expectations, and that's what's really driving it in the back half of the year. And again, we're going to be probably a little bit more discretionary about how we think about those distributors and what we may do with those distributors, whether we continue to consolidate or exit weaker distributors that are not delivering sustainable growth. Massimo Calafiore: Yes. Look, as I said before, we are intentionally prioritizing commercial channel quality. We never changed our thesis. So we want productivity and long-term value creation over growth at all costs. So this is where we are today. Thomas Stephan: Got it. Okay. Great. And probably a good segue into my second question, just on the declines from the smaller distributors. You talked about how -- Massimo, you talked about how these headwinds will persist the rest of the year. I guess a 2-parter here. One, can you elaborate on just why is this tracking weaker than expected? If you can sort of flesh that out a little bit? And then two, as we think beyond this year, like why won't this be a continued headwind? Or what specifically resolves this issue? Massimo Calafiore: It's just the increased percentage of revenue that is going to be concentrated to our top distributor. So right now, we are at 80% of our total revenue is in the hand of the top 30. So the exercise for us for the remainder of the year is within the 20%, really pick and choose the partners we want to invest on. If you remember, in earlier calls, we divided our overall commercial strategy in 3 different parts. One was focusing on distributors that were already at scale; two, existing distributors that can create scale; and three, identify the smaller distributors in key areas of interest for us to invest on. And this is what is going to keep going. I think that what is creating right now the headwind that we're seeing is mostly based on asset utilization. We are very disciplined about how we give assets in order to produce the revenue. If the asset don't turn, it's not a good investment for us to keep feeding this smaller shop, because in order to do that, we should totally change our investment thesis, increasing cash spending for bad revenue. So naturally, you see that the work that we are doing is going to just to restate the growth that we are seeing from our top partner over time. Similar to what we did in Biologics. You see we were very disciplined. Despite the headwind last year, we were very focused, and now we start to see we bear the fruit of our strategy. So I'm not expecting this to change into spine. Thomas Stephan: Got it. That's great. I'll squeeze in one more quick one, if that's okay. Julie, for you, I appreciate the free cash flow commentary and maybe some of the moving parts around the EU MDR order and timing around inventory. But any way you can help us kind of quantify where 2026 free cash flow may land? Any sort of range would be super helpful. Julie Andrews: Sure. Thanks, Tom. I mean, we're not providing an updated outlook on free cash flow for the year. We haven't reinstated our guidance there. I think the value of the order is $15 million. So you can kind of estimate and look at what our previous guidance was related to free cash flow and take those factors into consideration. Operator: There are no further questions at this time. I will now turn the call back over to Julie Dewey for closing remarks. Julie Dewey: Thank you, everyone, for your questions and for joining us today. We appreciate your time and interest. If you need any additional information, please reach out. We look forward to updating you next quarter. This concludes our call today. Operator: Ladies and gentlemen, thank you all for joining. You may now disconnect. Before you buy stock in Orthofix Medical, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Orthofix Medical wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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This article first appeared on GuruFocus. Net Sales Growth: 5% pro forma constant currency growth over prior year. Global Spinal Implants, Biologics, and Enabling Technologies Net Sales: $109 million, up 4% year-over-year. Therapeutic Solutions Net Sales: $64.2 million, up 3% year-over-year. Global Limb Reconstruction Net Sales: $37.7 million, up 11% year-over-year. Global Spine Fixation Net Sales: Up 10% on a constant currency basis; US spine fixation up 3%. Biologics Net Sales: Approximately flat year-over-year, improving from double-digit declines in 2025. Non-GAAP Adjusted Gross Margin: 71.7%, impacted by unfavorable geographic mix. Adjusted EBITDA: $20.1 million for Q2; full-year guidance raised to $95 million to $98 million. Total Cash: $104.4 million, including restricted cash. Full-Year 2026 Net Sales Guidance: $845 million to $855 million, representing approximately 5% pro forma constant currency growth at the midpoint. European Distributor MDR Arrangement: Expected to contribute approximately $15 million of incremental net sales in 2026, with the majority recognized in Q4; creates an approximately $22 million net sales headwind in 2027. Warning! GuruFocus has detected 5 Warning Signs with OFIX. Is OFIX fairly valued? Test your thesis with our free DCF calculator. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Orthofix Medical Inc (NASDAQ:OFIX) delivered 5% pro forma constant currency net sales growth in Q2 2026, with double-digit growth in global limb reconstruction and spine fixation. The restoration of Medicare reimbursement for bone growth stimulators removes a meaningful headwind for the therapeutic solutions business and improves second-half visibility. Biologics showed a marked improvement, moving from double-digit declines last year to approximately flat performance in Q2, the second consecutive quarter of improved year-over-year performance. The company secured a strategic European distributor arrangement that is expected to contribute approximately $15 million of incremental net sales in 2026, funded by the distributor for MDR certification. Orthofix Medical Inc (NASDAQ:OFIX) increased its full-year adjusted EBITDA guidance range to $95 million to $98 million, reflecting ongoing cost actions and operational progress. The launch of Access Team 2.0, an award-winning bone growth therapy device with enhanced ease of use and mobile app compatibility, strengthens the therapeutic solutions value proposition. Orthofix Medical Inc (NASDAQ:OFIX) experienced a steeper-than-expected decline among smaller U.S. spine distributors, whose productivity has been below expectations for several quarters. The company faces a $22 million net sales headwind in 2027 due to the timing of the European distributor MDR arrangement, which is a discrete benefit in 2026. Adjusted gross margin was negatively impacted by an unfavorable geographic mix during the quarter, coming in at 71.7%. Profitability was impacted by credit losses in certain international markets and continued investment in key launches, despite ongoing cost optimization initiatives. U.S. limb reconstruction growth was below expectations, as the company is still building the commercial infrastructure required to consistently convert clinical interest into revenue. The European distributor arrangement creates a temporary free cash flow timing headwind in 2026, as some cash receipts are projected to occur in 2027 while inventory-related cash outflows occur this year. Q: Can you provide more color on the updated guidance, specifically what has changed since the CMS reimbursement decision and the impact of the smaller spine distributor challenges?A: Julie Andrews (CFO): The updated outlook reflects a combination of underlying business trends and discrete factors. Positives include the restoration of Medicare reimbursement (approximately a $12 million benefit) and the European distributor arrangement (approximately $15 million of incremental net sales in 2026). We are also seeing stabilization in biologics and portions of limb reconstruction. These are offset by ongoing softness among smaller U.S. spine distributors, whose performance remains below expectations. We believed it was important to be transparent about both the progress and the execution risk that remains. Q: Regarding the European MDR distributor order dynamic, is the $15 million of sales incremental to your previous outlook, and does that imply core growth of only 1-2% in the second half?A: Julie Andrews (CFO): Yes, you are in the range of a 2% to 3% core growth rate. The weakening among smaller U.S. spine distributors is beyond our expectations and is driving the slower back-half growth. We are being more discretionary about how we think about those distributors, potentially consolidating or exiting weaker ones that are not delivering sustainable growth. Massimo Calafiore (CEO) added that they are intentionally prioritizing commercial channel quality and long-term value creation over growth at all costs. Q: Can you elaborate on why the smaller distributor performance is tracking weaker than expected and how you plan to address it?A: Massimo Calafiore (CEO): The headwind is mostly based on asset utilization. We are disciplined about how we allocate assets to produce revenue. If assets don't turn, it's not a good investment to keep feeding these smaller shops, as it would require increasing cash spending for bad revenue. We are picking and choosing partners to invest in, similar to our strategy in biologics where discipline is now bearing fruit. We expect these challenges to continue through the balance of the year. Q: Can you quantify where 2026 free cash flow may land, given the timing dynamics around the European MDR order and inventory?A: Julie Andrews (CFO): The value of the order is approximately $15 million. You can estimate the impact by looking at our previous free cash flow guidance and taking those factors into consideration. The European distributor arrangement creates a temporary free cash flow timing headwind in 2026 as some cash receipts are projected to occur in 2027, while inventory-related cash outflows occur this year. Q: With the Medicare reimbursement decision reversed and guidance increased, are you considering reinstating your long-range plan (LRP)?A: Julie Andrews (CFO): We are still assessing where we are and looking at our actions, particularly related to the smaller spine distributors and how that may impact our LRP over the next year or so. Q: Can you provide more detail on the performance of the biologics business and the investment in clinical evidence?A: Massimo Calafiore (CEO): Biologics is recovering very well. We strongly believe in our products and are investing in clinical evidence for OsteoCov and Virtuos, and starting a registry for Strength+. We also see a great opportunity in diabetic foot ulcers, having just submitted our IDE to the FDA. This could open up a potentially very lucrative opportunity for the organization. Q: What is driving the growth in the global limb reconstruction segment, and what are the expectations for the U.S. market?A: Massimo Calafiore (CEO): Global limb reconstruction grew 11% on a constant currency basis, led by TrueLock, Elevate, and FitBone, with strong international momentum. U.S. growth was below expectations, not due to lack of clinical interest, but because we are still building the commercial infrastructure required to consistently convert interest into revenue. Our focus is on improving distributor productivity and expanding market development activities. Q: Can you elaborate on the strategic arrangement with the European distributor and the MDR certification process?A: Julie Andrews (CFO): C-SPINE exited the European spine market in 2022. One of our largest European distributors expressed strong interest in continuing to sell some spine products. We entered into a strategic arrangement where the distributor funds our MDR certification work. The distributor intends to purchase sufficient inventory in 2026 to maintain continuity of supply. This contributes approximately $15 million of incremental net sales in 2026, with the majority in Q4, and creates an approximately $22 million headwind in 2027 while MDR requirements are completed. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

LEWISVILLE, Texas, August 05, 2026--(BUSINESS WIRE)--Orthofix Medical Inc. (NASDAQ:OFIX), a leading global medical technology company, today reported its financial results for the second quarter ended June 30, 2026, reflecting progress toward a more focused and consistent operating model. The Company also raised its full-year 2026 guidance for both net sales and adjusted EBITDA. All pro forma measures contained within this release exclude the impact of the discontinued M6™ product lines. Highlights Second quarter 2026 reported net sales of $210.9 million, representing an increase of 4% on a reported basis and 5% on a pro forma constant currency basis compared to second quarter 2025. Generated double-digit constant currency growth in Global Spine Fixation1 and Global Limb Reconstruction, reflecting strong international performance and continued demand across key growth platforms. Therapeutic Solutions (formerly Bone Growth Therapies) delivered 3% year-over-year net sales growth despite a temporary Medicare reimbursement headwind affecting bone growth stimulators during part of the second quarter. Biologics stabilized and began to regain momentum, supported by focused commercial execution. Second quarter 2026 reported net loss of $(15.8) million and non-GAAP adjusted EBITDA of $20.1 million. "Our second quarter results provide further evidence that the operational actions we have taken over the past year are beginning to show up more clearly in the business," said Massimo Calafiore, President and Chief Executive Officer of Orthofix. "We delivered 5% pro forma, constant-currency net sales growth, supported by double-digit growth in Global Limb Reconstruction and Spine Fixation, sequential momentum in Biologics, and the restoration of Medicare reimbursement for bone growth stimulators, which removes a meaningful headwind for our Therapeutic Solutions business as we enter the second half of the year." Mr. Calafiore continued, "While our transformation remains a work in progress, we believe Orthofix is operating from a stronger position than it was a year ago. Our focus remains on improving the quality of growth, strengthening commercial productivity, and building a more consistent path to profitability and cash generation. As we continue to execute with discipline, we believe we are building a stronger foundation for durable, profitable growth and long-term shareholder value." Financial Results Overview Second Quarter 2026 Net Sales and Financial Results The following table provides net sales by major product category and by reporting segment on a pro forma basis, removing the effects of the Company’s discontinued M6 product lines: For the second quarter of 2026, net sales were $210.9 million, representing an increase of 3.8% on a reported basis and 4.7% on a non-GAAP pro forma constant currency basis compared to second quarter 2025. For the second quarter of 2026, GAAP gross margins were 71.0% and were 71.7% on a non-GAAP adjusted basis. For the second quarter of 2026, reported net loss was $(15.8) million, or $(0.39) per share compared to reported net loss of $(14.1) million, or $(0.36) per share in the prior year period. Non-GAAP adjusted EBITDA was $20.1 million, or 9.6% of pro forma net sales, in the second quarter of 2026, compared to non-GAAP adjusted EBITDA of $20.6 million, or 10.3% of pro forma net sales, in the second quarter of 2025. Liquidity Cash, cash equivalents, and restricted cash on June 30, 2026, totaled $104.4 million compared to $120.9 million on March 31, 2026. The decrease was due to arbitration award and settlement payments related to pending claims from three former executives terminated in 2023. Business Outlook Following the restoration of Medicare reimbursement for non-invasive bone growth stimulators to its prior level, second-quarter performance, and the Company’s current expectations for the remainder of the year, Orthofix is increasing its full-year 2026 guidance for both net sales and adjusted EBITDA. All measures are provided on a non-GAAP pro forma basis and are based on current foreign currency exchange rates. Net sales are now expected to range from $845 million to $855 million, an increase of $7 million at both the low and high ends of the range from the Company’s previous guidance of $838 million to $848 million issued on May 21, 2026. The updated range represents approximately 5% year-over-year pro forma constant currency growth at the midpoint and does not take into account any additional exchange rate changes that may occur this year. The Company is increasing its full-year 2026 non-GAAP adjusted EBITDA guidance to $95 million to $98 million, compared to its previous guidance of $90 million to $93 million issued on May 21, 2026. The updated range reflects continued operating discipline and cost management, while also balancing planned growth investments and geographic mix dynamics. At the midpoint, this represents 80 basis points of non-GAAP adjusted EBITDA margin expansion compared to 2025. An investor presentation for the Company’s second quarter 2026 financial results is available in the "Events & Presentations" section of the Orthofix Investor Relations Website at ir.orthofix.com. Conference Call Orthofix will host a conference call today at 8:30 AM Eastern Time to discuss the Company’s financial results for the second quarter ended June 30, 2026. Interested parties may access the conference call by dialing (888) 596-4144 in the U.S., and (646) 968-2525 in all other locations, and referencing the conference ID 8700861. A webcast and replay of the conference call may be accessed in the "Events & Presentations" section of the Orthofix Investor Relations Website at ir.orthofix.com. Internet Posting of Information Orthofix regularly shares important updates in the "Investors" section of its website at www.orthofix.com. The Company encourages investors and potential investors to consult the Orthofix website regularly for important information about Orthofix. About Orthofix Orthofix is a global medical technology company dedicated to advancing healing and restoring mobility for patients with complex musculoskeletal conditions. Headquartered in Lewisville, Texas, the Company offers a differentiated portfolio of spinal implants, therapeutic solutions, limb reconstruction systems, biologics and enabling technologies, including the 7D FLASH™ Navigation System. Orthofix’s technology-enabled solutions are designed to support surgeons across the continuum of care and improve outcomes for patients. Learn more at Orthofix.com and follow Orthofix on LinkedIn. Forward-Looking Statements This communication contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, relating to our business and financial outlook, which are based on our current beliefs, assumptions, intentions, plans, expectations, estimates, forecasts and projections. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "projects," "intends," "predicts," "potential," "positioned," "deliver," or "continue" or other comparable terminology. Forward-looking statements in this communication include the Company’s expectations regarding net sales and adjusted EBITDA for the year ended December 31, 2026. Forward-looking statements are not guarantees of our future performance, are based on our current expectations and assumptions regarding our business, the economy and other future conditions, and are subject to risks, uncertainties and changes in circumstances that are difficult to predict, including the risks described in Part I, Item 1A under the heading Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2025, and in Part II, Item 1A under the heading Risk Factors in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026. Factors that could cause future results to differ from those expressed by forward-looking statements include, but are not limited to, (i) our ability to maintain operations to support our customers and patients in the near-term and to capitalize on future growth opportunities, (ii) risks associated with acceptance of surgical products and procedures by surgeons and hospitals, (iii) development and acceptance of new products or product enhancements, (iv) clinical and statistical verification of the benefits achieved via the use of our products, (v) our ability to adequately manage inventory, (vi) our ability to successfully optimize our commercial channels, (vii) our success in defending legal proceedings brought against us, and (viii) the other risks and uncertainties more fully described in our periodic filings with the Securities and Exchange Commission (the "SEC"). As a result of these various risks, our actual outcomes and results may differ materially from those expressed in these forward-looking statements. Further, any forward-looking statement speaks only as of the date hereof, unless it is specifically otherwise stated to be made as of a different date. The Company undertakes no obligation to update, and expressly disclaims any duty to update, its forward-looking statements, whether as a result of circumstances or events that arise after the date hereof, new information, or otherwise, except as required by law. The Company is unable to provide expectations of GAAP net income (loss), the closest comparable GAAP measures to adjusted EBITDA (which is a non-GAAP measure), on a forward-looking basis because the Company is unable to predict, without unreasonable efforts, the ultimate outcome of matters (including acquisition-related expenses, accounting fair value adjustments, and other such items) that will determine the quantitative amount of the items excluded in calculating adjusted EBITDA, which items are further described in the reconciliation tables and related descriptions below. These items are uncertain, depend on various factors, and could be material to the Company’s results computed in accordance with GAAP. ORTHOFIX MEDICAL INC.Non-GAAP Financial Measures The following tables present reconciliations of various financial measures calculated in accordance with U.S. generally accepted accounting principles ("GAAP"), to various non-GAAP financial measures that exclude (or in the case of free cash flow, include) items specified in the tables. The GAAP measures shown in the tables below represent the most comparable GAAP measure to the applicable non-GAAP measure(s) shown in the table. For further information regarding the nature of these exclusions, why the Company believes that these non-GAAP financial measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the Company’s current report on Form 8-K regarding this press release filed today with the SEC available on the SEC’s website at www.sec.gov and on the "Investors" page of the Company’s website at www.orthofix.com. The Company’s non-GAAP financial measures for the three and six months ended June 30, 2026, and 2025, have been adjusted to eliminate the financial effects of the Company’s decision to discontinue its M6 product lines. View source version on businesswire.com: https://www.businesswire.com/news/home/20260805908825/en/ Contacts Company ContactInvestors and Media Julie Dewey, IRCChief Investor Relations & Communications [email protected] +1 209.613.6945

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is intentionally prioritizing commercial channel quality and long-term value creation over 'growth at all costs,' leading to a disciplined evaluation of smaller distributors. Spine Fixation performance is bifurcated, with the top 30 distributors (80% of sales) performing well while smaller distributors face productivity challenges and potential consolidation or exits. Biologics showed significant stabilization, moving from double-digit declines in 2025 to approximately flat year-over-year performance, driven by improved account engagement and utilization. Therapeutic Solutions demonstrated resilience despite temporary reimbursement pressure, benefiting from steady demand and a strong margin profile. Global Limb Reconstruction growth is currently driven by international momentum, while U.S. performance is constrained by the ongoing build-out of commercial infrastructure. The company is shifting its investment thesis to focus on asset utilization, refusing to increase cash spending on 'bad revenue' from underperforming smaller distributor shops. Full-year 2026 guidance assumes a $15 million incremental benefit from a strategic European distributor arrangement, though this creates a projected $22 million headwind for 2027. Management expects challenges with smaller U.S. spine distributors to persist through the balance of the year, impacting core growth rates in the second half. The restoration of Medicare reimbursement for bone growth stimulators is expected to remove a meaningful headwind and improve visibility for the Therapeutic Solutions business. Strategic investments are being directed toward clinical evidence generation for OsteoCove and Virtuos, and a new IDE submission for diabetic foot ulcer applications in Limb Reconstruction. Q4 sequential growth is expected to be primarily driven by the timing of European inventory purchases and normal seasonal trends. A strategic contractual arrangement was formed where a European distributor is funding MDR certification work to maintain market access for specific spine products. The European distributor arrangement creates a temporary free cash flow timing headwind in 2026, as inventory outflows occur this year while some receipts are delayed until 2027. Medicare reimbursement for bone growth stimulators was restored to prior levels retroactive to May 18, 2026, following successful stakeholder feedback. Profitability in Q2 was impacted by unfavorable geographic mix and credit losses in certain international markets. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. The $7 million guidance increase reflects a $12 million Medicare restoration benefit and a $15 million European distributor benefit, offset by softness in smaller spine distributors. Management emphasized that the transformation is not linear and they are maintaining EBITDA targets despite these shifting variables. Excluding the $15 million European tailwind, core growth is projected to be in the 2% to 3% range for the second half of the year. The deceleration from mid-single digits is attributed to weakening performance among smaller U.S. spine distributors that do not meet productivity expectations. Management is focusing on asset utilization; if assets do not turn, they will not continue to invest in those specific smaller distributors. The long-term goal is to concentrate revenue within top-tier partners, mirroring the successful stabilization strategy recently executed in the Biologics segment. Management is not yet reinstating the LRP as they continue to assess the impact of spine distributor consolidation and exits over the next year.

Interested in Orthofix Medical Inc.? Here are five stocks we like better. Orthofix reported 5% pro forma constant-currency sales growth in the second quarter, supported by double-digit growth in spine fixation and limb reconstruction, stabilizing biologics, and restored Medicare reimbursement for bone-growth stimulators. Smaller U.S. spine distributors remained a significant weakness despite strong performance from the company’s largest distributors. Orthofix expects the productivity challenge to persist through 2026 and is evaluating consolidation, investment or exits among underperforming relationships. The company raised its 2026 outlook to $845 million–$855 million in sales and $95 million–$98 million in adjusted EBITDA, partly reflecting a European distributor arrangement expected to add about $15 million of 2026 sales, primarily in the fourth quarter. Orthofix Medical (NASDAQ:OFIX) reported second-quarter results that management said reflected improving operating trends across several businesses, while continued weakness among smaller U.S. spine distributors remained a headwind. The company reiterated its focus on commercial productivity, disciplined investment and profitable growth rather than pursuing revenue growth at any cost. President and Chief Executive Officer Massimo Calafiore said the company generated 5% pro forma constant-currency net sales growth from the prior-year period, excluding discontinued M6 artificial disc product lines. Growth was supported by double-digit increases in global limb reconstruction and spine fixation, sequential improvement in biologics, and the restoration of Medicare reimbursement for bone growth stimulators. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control “Our transformation remains a work in progress,” Calafiore said, adding that Orthofix is operating from a stronger position than it was a year earlier but that improvements will not occur uniformly across the portfolio. Global spine fixation sales rose 10% on a constant-currency basis during the quarter, including 3% growth in U.S. spine fixation sales. Calafiore said the company’s top 30 distributors, which account for about 80% of spine fixation sales, continued to perform well. → 3 Drone Stocks That Should Soar After the Summer Slump However, Orthofix saw a steeper decline among its remaining smaller distributors, where productivity has been below management’s expectations for several quarters. The company expects those challenges to persist through the rest of 2026 and is evaluating which relationships merit continued investment, consolidation or potential exit. Calafiore said the issue was tied to distributor-channel productivity and asset utilization rather than demand. He said Orthofix is being selective in allocating assets to smaller distributors that do not generate sufficient returns, aiming to concentrate a larger share of revenue with its highest-performing distribution partners over time. → The Bitcoin Comeback May Already Be Underway—2 ETFs for Exposure The company also reported completing its first clinical cases using its VIRATA minimally invasive system during the second quarter. Orthofix is preparing for a full market launch of the VIRATA spinal implant system later in the fourth quarter. Management said early surgeon feedback has been encouraging and that it views VIRATA as part of an integrated procedural platform alongside its interbody, surgical access and 7D enabling technologies offerings. Global spinal implants, biologics and enabling technologies produced $109 million in net sales, up 4% from the prior-year period on the company’s pro forma constant-currency basis. Spine fixation led the growth, aided by international momentum and the timing of distributor orders. Biologics sales were approximately flat year over year, marking a second consecutive quarter of improved comparisons after the business recorded double-digit declines in 2025. Calafiore said management sees the stabilization as encouraging but needs greater consistency before characterizing it as a sustained return to growth. Orthofix is seeking to support the business through commercial efforts around OsteoCove bioactive synthetic bone graft and investment in clinical evidence for OsteoCove and Virtuos, as well as a product registry for Strand Plus. Therapeutic solutions generated $64.2 million in net sales, a 3% year-over-year increase despite the impact of a temporary Medicare reimbursement reduction during part of the quarter. The Centers for Medicare & Medicaid Services restored reimbursement for bone growth stimulators to its earlier level, retroactive to May 18, 2026. Chief Financial Officer Julie Andrews said the reimbursement restoration represents an approximately $12 million benefit. Management expects therapeutic solutions to contribute more favorably in the second half, citing resilient demand and constructive utilization and prescribing trends. During the quarter, Orthofix launched AccelStim 2.0, a redesigned bone growth therapy device compatible with the company’s STIM onTrack mobile application and STIM MD physician platform. Global limb reconstruction sales increased 11% to $37.7 million, driven by international demand and adoption of the TrueLok Elevate and Fitbone product families. U.S. growth was more modest, which management attributed to the need to build commercial infrastructure and improve distributor productivity in the emerging domestic limb reconstruction market. Orthofix said its second-half assumptions include stronger commercial productivity, the lapping of sunsetting product lines and prioritization of higher-return opportunities. The company also cited diabetic foot ulcers as a potential future opportunity and said it has submitted an investigational device exemption application to the FDA related to that area. Orthofix raised its full-year 2026 net sales outlook to a range of $845 million to $855 million, an increase of about $7 million from its May outlook. At the midpoint, the forecast represents about 5% pro forma constant-currency growth. The company also increased its adjusted EBITDA outlook to $95 million to $98 million. Second-quarter adjusted EBITDA was $20.1 million, while non-GAAP adjusted gross margin was 71.7%. Andrews said profitability was affected by unfavorable geographic mix, credit losses in certain international markets and continued investment in launches, partly offset by cost optimization actions. The revised sales outlook includes a strategic arrangement with a large European distributor that is funding MDR certification-related work for certain spine products. The distributor intends to purchase inventory during 2026 to support continuity of supply while certification and country-specific access requirements are completed. The arrangement is expected to add about $15 million of net sales in 2026, with most of the benefit anticipated in the fourth quarter. Orthofix expects the arrangement to create an approximately $22 million net sales headwind in 2027 while MDR requirements are completed. The arrangement is also expected to create a temporary 2026 free-cash-flow timing headwind because some cash receipts are projected for 2027 while inventory-related cash outflows occur this year. For the third quarter, management expects sales to be generally consistent with second-quarter levels, as the reimbursement recovery and improving trends in several businesses are expected to be offset by continued softness among smaller U.S. spine distributors. Fourth-quarter sequential growth is expected to reflect the European distributor inventory purchases and normal seasonality. Orthofix ended the quarter with $104.4 million in total cash, including restricted cash. The company did not provide an updated free-cash-flow outlook or reinstate free-cash-flow guidance. Orthofix Medical Inc (NASDAQ: OFIX) is a global medical device company focused on the design and development of innovative orthopedic and spinal solutions. The company's core business is divided into two segments: spine and orthopedics. In the spine segment, Orthofix offers a range of titanium implants, biologics and portable bone growth stimulation devices designed to support spinal fusion, deformity correction and minimally invasive procedures. Its orthopedic segment encompasses products for fracture fixation, external fixation systems, trauma care and sports medicine, providing surgeons with implantable devices and instruments for complex bone reconstruction and healing. Orthofix's product portfolio includes strut systems, bone growth stimulators, interbody fusion devices and fixation hardware that address various indications such as degenerative disc disease, spinal deformities, non-unions and long-bone fractures. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Orthofix Medical Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Orthofix (OFIX) came out with quarterly earnings of $0.07 per share, beating the Zacks Consensus Estimate of a loss of $0.03 per share. This compares to earnings of $0.13 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +333.33%. A quarter ago, it was expected that this medical device maker would post a loss of $0.29 per share when it actually produced a loss of $0.12, delivering a surprise of +58.62%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Orthofix, which belongs to the Zacks Medical - Instruments industry, posted revenues of $210.9 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.67%. This compares to year-ago revenues of $203.12 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Orthofix shares have lost about 19.5% since the beginning of the year versus the S&P 500's gain of 13%. While Orthofix has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Orthofix was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.08 on $211.47 million in revenues for the coming quarter and $0.27 on $842.98 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Instruments is currently in the bottom 35% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Delcath Systems, Inc. (DCTH), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This company is expected to post quarterly loss of $0.16 per share in its upcoming report, which represents a year-over-year change of -328.6%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Delcath Systems, Inc.'s revenues are expected to be $25.14 million, up 4.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ORTHOFIX MEDICAL INC. (OFIX) : Free Stock Analysis Report Delcath Systems, Inc. (DCTH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Wall Street expects a year-over-year decline in earnings on higher revenues when Orthofix (OFIX) reports results for the quarter ended June 2026. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on August 5, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This medical device maker is expected to post quarterly loss of $0.03 per share in its upcoming report, which represents a year-over-year change of -123.1%. Revenues are expected to be $209.51 million, up 3.2% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 5.41% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Orthofix, the Most Accurate Estimate is the same as the Zacks Consensus Estimate, suggesting that there are no recent analyst views which differ from what have been considered to derive the consensus estimate. This has resulted in an Earnings ESP of 0%. On the other hand, the stock currently carries a Zacks Rank of #2. So, this combination makes it difficult to conclusively predict that Orthofix will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Orthofix would post a loss of$0.29 per share when it actually produced a loss of -$0.12, delivering a surprise of +58.62%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Orthofix doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. ClearPoint Neuro, Inc. (CLPT), another stock in the Zacks Medical - Instruments industry, is expected to report loss per share of $0.29 for the quarter ended June 2026. This estimate points to a year-over-year change of -38.1%. Revenues for the quarter are expected to be $13 million, up 41% from the year-ago quarter. Over the last 30 days, the consensus EPS estimate for ClearPoint Neuro has remained unchanged. Nevertheless, the company now has an Earnings ESP of -15.12%, reflecting a lower Most Accurate Estimate. This Earnings ESP, combined with its Zacks Rank #3 (Hold), makes it difficult to conclusively predict that ClearPoint Neuro will beat the consensus EPS estimate. The company could not beat consensus EPS estimates in any of the last four quarters. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ORTHOFIX MEDICAL INC. (OFIX) : Free Stock Analysis Report ClearPoint Neuro, Inc. (CLPT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Performance was driven by the successful completion of distributor transitions, with the top 30 partners delivering 27% year-over-year growth. Management simplified the spine leadership structure in April to bring decision-making closer to the field and increase accountability as the company scales. Spine Fixation growth of 6% was supported by deeper procedural penetration and the 7D FLASH navigation system acting as a core differentiator for surgeon engagement. Biologics performance improved sequentially following targeted actions to expand account penetration and increase utilization across both spine and orthopedic portfolios. The company is shifting focus from restructuring to execution, prioritizing high-value categories and deemphasizing lower-return products in the Limb Reconstruction segment. Therapeutic Solutions continues to outperform the market, serving as a reliable contributor to overall margin expansion and cash generation. Full-year guidance assumes a growth acceleration from 5% in the first half to 6% in the second half of 2026. The second half of the year is expected to benefit from the full market launch of the VIRATA open system and the alpha launch of VIRATA MIS. Limb Reconstruction is projected to return to double-digit growth in the U.S. during the second half of 2026 as capital sales pipelines strengthen. Management expects to exit 2026 with a more durable growth profile in Biologics by building clinical evidence and supporting physician advocacy. Free cash flow is projected to be positive for the full year, excluding potential legal settlements, supported by disciplined capital deployment. The CMS TEAM pilot program had a one-time impact of less than 0.5% on the fourth quarter growth rate, which was lower than the originally anticipated 1% impact. First quarter growth was negatively impacted by approximately 1.6% due to having one less selling day compared to the prior year. International results were boosted by approximately $2 million in timing-related stocking orders, which offset some softness in the Middle East due to regional conflict. The company sunset approximately 30 product lines in the previous year to focus on higher-margin, high-growth platforms like TrueLok Elevate and Fitbone. Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Growth will accelerate as the company annualizes the impact of distributor terminations and launches the VIRATA system. The leadership realignment was designed to shorten the distance between the CEO and field operations to maintain commercial momentum. Management expects minimal impact for the full year; Q1 saw some order timing shifts that were largely offset by other stocking activity. The company plans to apply the same rigor used for top-tier partners to a 'second tier' of distributors throughout 2026 to improve operational excellence across the network. Recent softness was attributed to the sunsetting of legacy products and the timing of OSCAR capital sales. A restructured capital sales team and a strengthening pipeline support the expectation of a return to double-digit growth in the second half of the year. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here.

Q1 net sales were $196.4 million (pro forma constant currency +3% excluding discontinued M6 lines) and the company reaffirmed full‑year 2026 guidance of $850–$860 million in net sales with adjusted EBITDA guidance of $95–$98 million and positive free cash flow (ex‑legal settlements). Management reported clear commercial progress in Spine—Global Spine Fixation sales grew ~6% (U.S. +4%), the top 30 distributor partners delivered +27% YoY, distributor transitions are “largely behind us,” and Orthofix is ramping product launches including the 7D FLASH system and the full market launch of Virata in H2 2026. Therapeutic Solutions outperformed the market (Q1 sales $57.8 million, +5% with fracture +6%) and Biologics showed sequential improvement after targeted execution actions, while Limb Reconstruction (Q1 sales $32.8 million) expects to return to double‑digit U.S. growth in H2 2026. Interested in Orthofix Medical Inc.? Here are five stocks we like better. Orthofix Medical (NASDAQ:OFIX) reported first-quarter 2026 results that management said reflect steadier execution, improving stability, and the early benefits of actions taken to reset its Spine commercial channel. Total global net sales for the quarter ended March 31, 2026 were $196.4 million, up 3% year-over-year on a pro forma constant currency basis, excluding discontinued M6 product lines, according to Chief Financial Officer Julie Andrews. President and CEO Massimo Calafiore said the company’s first-quarter performance showed “steady execution, improving stability, and sharper strategic focus,” adding that Orthofix began to see “the expected progress from our Spine commercial channel actions” as the quarter progressed. → Roblox Stock Slides to New Low as Safety Changes Weigh on Outlook In Spine, Calafiore said global Spine Fixation net sales grew 6% on a constant currency basis, with U.S. net sales growth of 4%. He attributed results to “enhanced commercial focus, deeper procedural penetration, and the ongoing benefits of our distributor transitions,” noting that the distributor transitions are “now largely behind us.” Calafiore also pointed to strong performance among the company’s top distributor partners. “Our top 30 distributor partners delivered net sales growth of 27% year-over-year and 24% on trailing 12 months basis,” he said, describing the results as support for Orthofix’s strategy to prioritize larger distributors and deepen relationships with key partners. → The Real SpaceX Play: 5 Chip Stocks Powering the IPO Before It Launches During the Q&A, Calafiore told analysts the company plans to extend this approach beyond its top distributors. He said Orthofix has moved past “phase number 1” of its distributor plan and will focus in 2026 on helping the “second tier” of distributors grow using “the same discipline and rigor” applied to the top 30. Calafiore described the 7D FLASH navigation system as a “core differentiator” that supports precision and workflow and increases surgeon engagement. He said Orthofix is intensifying its commercial focus on adoption of 7D FLASH to support a more integrated Spine offering. → 3 Emerging Markets ETFs to Maximize Exposure to High-Potential Countries He also said the company remains on track for the full market launch of Virata in the second half of 2026. In response to a question on U.S. Spine growth, Calafiore cited multiple drivers for anticipated acceleration through the year, including annualization of distributor changes and upcoming product launches. He said Orthofix is “on time for the full market launch of the Virata open system and on time on the alpha launch of the Virata MIS,” and expects “a very good strong contribution” from those systems in the second half. In Limb Reconstruction, Andrews said global net sales were $32.8 million, up 3% in the quarter. U.S. performance was flat, which she attributed “largely due to the timing of OSCAR capital sales.” She said the company restructured its capital sales team and is seeing “a strengthening capital pipeline,” while also seeing continued acceleration in worldwide adoption of TrueLok Elevate and Fitbone. Andrews said Orthofix expects to “return to double-digit growth in the U.S. in the second half of 2026” for the Limb Reconstruction business. In a separate question on the apparent slowing in U.S. orthopedics/limb reconstruction, Andrews said “the momentum hasn’t slowed,” but cited “transient issues,” including the decision to sunset about 30 product lines last year, which began to impact results in the fourth quarter and continued into the first quarter, along with the timing of OSCAR capital sales. Therapeutic Solutions (formerly Bone Growth Therapies) posted net sales of $57.8 million, up 5% year-over-year, with Andrews saying the business continued to outperform the broader market. She noted fracture sales grew 6% in the quarter and said Orthofix expects growth to remain above market rates of 2% to 3% due to execution, new surgeon additions, and competitive conversions, “especially in the fracture channel.” Biologics, meanwhile, was described as an area where the company is applying tighter execution discipline. Calafiore said performance improved sequentially during the quarter as Orthofix implemented targeted actions to expand account penetration and increase utilization across the portfolio. He said the company is “refining our go-forward strategy, building clinical evidence, and supporting advocacy,” with actions intended to position Biologics to exit 2026 with “stronger momentum and a more durable growth profile.” Asked about expectations for Biologics growth by year-end, Calafiore said Orthofix expects the business “to go back to market growth,” while acknowledging work remains. He clarified that a leadership realignment was driven by experience, stating it was “more a realignment under a leader that is Patrick Fisher,” rather than a broader move under orthopedics leadership. Andrews said Orthofix does not break out Biologics revenue separately and could not provide the size of the Biologics business, though she pointed analysts to pre-merger results and the company’s quarterly disclosures that include an MTF service fee component. Andrews said first-quarter performance included some discrete items. Timing of certain international stocking orders benefited results by approximately $2 million, though she said the “majority of performance reflected underlying execution.” She also noted the quarter had one less selling day than the prior year, reducing growth rates by about 1.6%. Additionally, a CMS team pilot program that began in January and includes bone growth stimulation had a one-time impact of less than 0.5% on first-quarter growth, Andrews said, below the roughly 1% impact the company had originally anticipated. On profitability, Andrews reported pro forma non-GAAP adjusted gross margin of 70.7%, a 40 basis point improvement over the prior year, driven by freight and logistics productivity improvements, partially offset by unfavorable geographic mix. Pro forma non-GAAP adjusted EBITDA was $9.7 million, which she said was in line with expectations, reflecting the impacts from geographic mix and commercial transitions. Orthofix ended the quarter with $120.9 million in total cash, including restricted cash. Andrews said the increase in cash was due to financing activities during the quarter, including a draw on the second tranche of the company’s debt facility. Orthofix reaffirmed its full-year 2026 guidance. Andrews said net sales are expected to range between $850 million and $860 million, representing about 5.5% pro forma constant currency growth at the midpoint. She said the company expects net sales growth of approximately 5% in the first half of the year and about 6% in the second half. In response to an analyst question on cadence, Andrews said that adjusting first-quarter results for the selling day and the CMS pilot program impact puts the company “right at kind of that 5% growth rate” for Q1. For Q2, she said Orthofix would expect growth “in the 6%, 6% range” to support the first-half outlook. For profitability, Andrews said non-GAAP adjusted EBITDA is expected to be between $95 million and $98 million, representing roughly 70 basis points of margin expansion at the midpoint. Free cash flow is expected to be positive for the full year, excluding potential legal settlements. Andrews also addressed geopolitical concerns, saying the company expects “very minimal impact for the full year” related to the Middle East. She said Q1 saw a timing impact in Spine orders in the region, “primarily with orders,” but it was “more than made up for with other stocking orders,” and she said it was not a material factor embedded in full-year expectations. Calafiore closed the call by reiterating the company’s priorities for 2026: “Deliver quarter by quarter progress, expand margins, generate cash, and translate our innovation and execution into durable shareholder value.” Orthofix Medical Inc (NASDAQ: OFIX) is a global medical device company focused on the design and development of innovative orthopedic and spinal solutions. The company's core business is divided into two segments: spine and orthopedics. In the spine segment, Orthofix offers a range of titanium implants, biologics and portable bone growth stimulation devices designed to support spinal fusion, deformity correction and minimally invasive procedures. Its orthopedic segment encompasses products for fracture fixation, external fixation systems, trauma care and sports medicine, providing surgeons with implantable devices and instruments for complex bone reconstruction and healing. Orthofix's product portfolio includes strut systems, bone growth stimulators, interbody fusion devices and fixation hardware that address various indications such as degenerative disc disease, spinal deformities, non-unions and long-bone fractures. The article "Orthofix Medical Q1 Earnings Call Highlights" was originally published by MarketBeat.