TMCI

Image source: The Motley Fool. Friday, Aug. 7, 2026 at 8:00 a.m. ET Chief Executive Officer - John Treace Chief Financial Officer - Mark Hair Investor Relations - Trip Taylor Operator: Ladies and gentlemen, thank you for standing by. Welcome to Treace Medical Concepts Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would like now to turn the conference over to Trip Taylor, Investor Relations. Please go ahead. Trip Taylor: Good morning, everyone, and welcome to our second quarter 2026 earnings conference call. Participating from the company today will be John Treace, Chief Executive Officer; and Mark Hair, Chief Financial Officer. On this call, John and Mark will discuss the second quarter financial results and 2026 outlook. We'll then host a question-and-answer session following the prepared remarks. The earnings press release can be found in the Investor Relations section of our website at investors.treace.com. This call is being recorded and will be archived in the Investors section of our website. Before we begin, we would like to remind you that it is our intent that all forward-looking statements made during today's call will be protected under the Private Securities Litigation Reform Act of 1995. Any statements that relate to expectations or predictions of future events and market trends as well as our estimated results or performance are forward-looking statements. All forward-looking statements are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. All forward-looking statements are based upon currently available information, and Treace Medical assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these statements. Please refer to our SEC filings, including our 2025 Form 10-K and our Form 10-Q for the second quarter of 2026, filed before the market opens today, August 7, which can be found in the Investor Relations section on our website at investors.treace.com for a detailed presentation of risks. With that, I will now turn the call over to John. John Treace: Thank you, Trip. Good morning, everyone, and thank you for joining us on our second quarter 2026 earnings conference call. We are pleased with our results in the second quarter with our revenue growth rate improving sequentially and our focus on profitability generating stronger adjusted EBITDA and reduced cash usage over prior year. These results were driven by continued year-over-year case volume growth, which accelerated to high single digits in the quarter and market share gains driven by increasing surgeon adoption of our comprehensive bunion portfolio and early impact of our expanding line of new technologies, now allowing us to tap into a broader range of procedures throughout the foot and ankle. We continue to focus on investing in growth initiatives to leverage this growing portfolio while driving improved profitability, positioning us for stronger growth expected in the second half of the year. As a result, we are raising our full year 2026 revenue guidance to be in the range of $204 million to $212 million, representing a decline of 4% to 0% compared to full year 2025. This compares to previous revenue guidance of $202 million to $212 million. Importantly, this outlook assumes ongoing expected dynamics, including continued procedure volume increases and the lapping of the ASP mix shift dynamics related to our 2025 product launches and as we begin to benefit from our 2026 planned product launches. More specifically, this year, we expect to return to positive revenue growth in our seasonally strongest fourth quarter. Now turning to our growth strategy. As we continue to prioritize penetration of the bunion market and maximize the impact of our expanded portfolio, we are focusing on 3 key initiatives; first, driving the adoption of our 3 new bunion systems launched in 2025 across our large customer base of over 3,300 existing surgeon customers. Second, to build upon our leadership position with Lapiplasty by advancing new technologies that appeal to existing and new surgeons. And third, continue to broaden our portfolio by launching new technologies, allowing us to address adjacent procedures performed by our existing surgeon customers, enabling us to grow wallet share and expand our addressable market. And we continue to deliver these technologies through our sales channels that include our focus direct sales team, which accounts for approximately 80% of our revenue. Speaking now to our first initiative. Before reviewing our commercial progress, I'd like to briefly reiterate the strategic importance of the bunion technologies we introduced in 2025. We believe these new systems meaningfully expand our addressable market beyond Lapiplasty and Adductoplasty. Nanoplasty and Percuplasty expand our reach into the high-volume osteotomy segment with differentiated 3D minimally invasive solutions designed to simplify adoption and deliver consistent 3D Bunion Correction. While our SpeedMTP system extends our portfolio into the large and attractive MTP Fusion market, which overlaps with bunion pathology and is among one of the most common foot and ankle procedures performed. Across our large base of over 3,300 surgeon customers, we estimate Lapiplasty in recent years has captured around 25% of their bunion-related procedure volume on average. Our 3 new platforms are designed to address the remaining 75% of their procedure volume, creating a significant opportunity to increase surgeon utilization and drive long-term growth across the estimated 4.4 million annual U.S. bunion sufferers. Importantly, we believe our strategy is working, and this continues to validate our confidence in the significant opportunity ahead of us. Through Q2, approximately 40% of our Lapiplasty surgeon user base has already utilized at least 1 of our 3 new bunion systems since their launch in the third quarter of 2025. This builds upon the 35% utilization rate we reported in the first quarter of 2026. In addition, approximately 30% of the growing number of new surgeons who first became Treace customers by using 1 of our 3 new bunion systems have also used Lapiplasty technology, demonstrating a pull-through effect to Lapiplasty technologies from this new surgeon cohort. Turning to our second initiative. Our core Lapiplasty franchise remains a key strategic priority. As a recognized leader in the Lapidus fusion segment, which represents approximately 30% of the estimated 450,000 annual U.S. bunion procedures, we are continuing to invest in innovation to improve our existing users' experience, appeal to new surgeons and extend our market leadership. We remain on track for a limited commercial launch of our next-generation Lapiplasty Lightning platform in the fourth quarter of this year. Lightning features new 3D correction instrumentation and SpeedTMT implants designed to simplify workflow, reduce procedure time and enhance the surgeon's accuracy and their control over the 3D correction. Another key initiative for our Lapiplasty strategy is our focus on increasing surgeon adoption of our IntelliGuide technology, the industry's first patient-specific planning and cut guide system for Lapiplasty bunion and Adductoplasty midfoot corrections in the U.S. IntelliGuide reduces steps and save time and is particularly valuable in helping surgeons with treating complex deformities and revisional surgeries with greater confidence and control. We believe the combination of our Lapiplasty Lightning and IntelliGuide PSI platforms provide a compelling and unique value proposition and can support further surgeon adoption and reinforce our category leadership in this key market segment. Now turning to our third initiative. We continue to broaden our portfolio beyond bunions to allow our sales force to more fully service a greater share of our surgeon customers' overall foot and ankle procedures and product needs and grow our share of wallet. During the second quarter, we took an important step towards this initiative with a limited commercial release of our new SuperBite compression screw system. As a reminder, compression screws are a fundamental bone fixation technology utilized broadly throughout the foot and ankle. We continue to receive very positive feedback and encouraging early customer uptake from our early market release of SuperBite. SuperBite features an innovative self-drilling and counter sinking design that can reduce or in many cases, eliminate the need for pre-drilling, improving OR efficiency and simplifying the procedure. SuperBite, which we expect to fully commercialize this quarter, enables our sales force for the first time to participate in a wide range of incremental foot and ankle surgical procedures from the forefoot to the mid-foot and hind foot and these incremental SuperBite cases often utilize additional Treace products. Building upon our recent access into the mid-foot and hindfoot fusion procedures facilitated by SuperBite, we recently completed our initial cases utilizing our HyperPlate XM dynamic compression locking implant technology. Fusions of these larger joints in the mid- and hindfoot can be challenging and have associated historically with higher nonunion rates. The HyperPlate XM implant combination of locking screws and dynamic compression provides a highly stable construct with an anatomic shape designed to promote fusion in these larger mid-foot and hind foot applications. And consistent with our focus to provide innovative sterile instrumentation to make procedures more reproducible and more efficient, we developed and recently commercialized the GreatReleaseXM instrument. GreatReleaseXM is specifically designed to facilitate more efficient and thorough release of the soft tissues connecting these larger joints so that the joint surfaces can be accessed to prepare for fusion. And in the fourth quarter, we plan to further strengthen this mid- and hindfoot portfolio with the introduction of our new CartiBlaster powered joint preparation rasps. These single-use sterile-packed rasp connect with a powered saw handpiece and are designed to speed up and facilitate thorough removal of the cartilage from these larger joint surfaces to effectively prepare them for fusion. We believe HyperPlate XM implants, GreatReleaseXM instruments and CartiBlaster rasp complemented by our SuperBite compression screws present a differentiated problem-solving portfolio to help surgeons advance their outcomes in their mid- and high-foot fusion cases. In closing, we're pleased with the progress we made during the second quarter as we strengthened our leadership position in 3D bunion correction, advanced our portfolio and increased our presence across the foot and ankle market. Our focus remains on unlocking the full potential of this broader portfolio while investing in our key growth initiatives. Looking ahead, our anchor position in the bunion market has presented opportunities to leverage our core capabilities into new procedural adjacencies and continue to more broadly service our surgeon customers. We will continue to develop innovative solutions to address our customers' unmet clinical needs, support our customers' outcome with best-in-industry medical education and service them with our direct focused sales team. As we execute this strategy, we believe we can drive sustainable long-term growth and create long-term value for our shareholders. With that, let me now turn the call over to Mark to review our financial performance. Mark? Mark Hair: Thank you, John. Good morning, everyone. Revenue in the second quarter was $45.4 million, a decrease of 4% compared to the prior year period. The decrease was driven by lower procedure kit sales to stocking distributors and a continued mix shift towards lower-priced minimally invasive products. Excluding sales to stocking distributors, we sold more procedure kits in the quarter compared to the prior year period. Gross margin was 78.5% in the second quarter of 2026, compared to 79.7% in the second quarter of 2025. Total operating expenses decreased 8% to $50.6 million in the second quarter of 2026, compared to total operating expenses of $54.7 million in the second quarter of 2025. Second quarter net loss was $15.9 million or $0.24 per share compared to a net loss of $17.4 million or $0.28 per share in the second quarter of 2025. Adjusted EBITDA for the second quarter was a loss of $3.5 million, compared to a loss of $3.6 million in the second quarter of 2025, representing both improved leverage and profitability. Year-to-date, cash usage reduced by 57% or $3.6 million when compared to the same period in 2025. Cash, cash equivalents and marketable securities totaled $45.6 million as of June 30, 2026. Turning to our outlook for full year 2026. As John mentioned, we are raising our full year guidance and expect full year 2026 revenue to be in the range of $204 million to $212 million, representing a decline of 4% to 0% compared to the full year 2025. This compares to previous revenue guidance of $202 million to $212 million. We expect revenue declines to continue until our seasonally strongest fourth quarter. We believe revenue in the fourth quarter will largely be supported by accelerating case volumes, the annualization of the mix shift dynamics from last year's bunion product launches as well as contributions from our 2026 product launches. We are updating our adjusted EBITDA guidance to be in the range of a loss of $3 million to $5 million for the full year 2026 as compared to previous guidance of a loss in the range of $4 million to $6 million. The company reported an adjusted EBITDA loss of $3.9 million for the full year 2025. In addition, we are reiterating an expected reduction in cash usage of approximately 50% for full year 2026 as compared with full year 2025. Supported by our balance sheet and available liquidity, we believe we are well positioned to continue executing our strategic and growth initiatives for the foreseeable future. With that, I'll turn the call over to the operator to open the lines for questions. Operator: [Operator Instructions] And our first question will come from Ryan Zimmerman with U.S. Bancorp. Iseult McMahon: This is Izzy on for Ryan. John, just to start off, I was curious if you could spend some time just talking about the quarter-over-quarter improvements or changes that you saw in terms of volume and pricing and whether or not either of these dynamics have improved with the new products that you've brought to market so far? John Treace: Izzy, appreciate the question. Within the quarter, what we saw was greater penetration of our 3 new bunion systems that we launched in Q3 of last year. We went from 35% of our 3,300 surgeon base using those products last quarter to 40%. So that was nice to see. We also saw some contributions from our limited market release of our SuperBite screw system, and that penetrated some new procedures. So when you combine those 2 together, we accelerated our case volume growth. We talked about mid-single digits over the last couple of quarters. We were in the high single digits this quarter. So we are pleased with what we saw there, and that's pretty much what played out in the quarter that led to the result. Iseult McMahon: Appreciate that. And then, Mark, as we think about the guide for '26 and the step-up for the seasonally strong fourth quarter. Could you spend a little bit of time parsing out exactly how you're thinking of the pacing in third quarter and fourth quarter? Mark Hair: Yes, I appreciate that. Yes, we are really excited. This is what John said, that a lot of the strategies -- the commercial strategies that we've been implementing last year with our new product launches, they've been successful this year, and we really feel like the trends are working according to plan. So the way we see the second half of the year is for this continued strategies to continue to work. And so we'll see continued improvement in case volumes and more contribution from these new products in the back half of the year. Now fourth quarter is always our seasonally strongest quarter. We've always seen that step up -- sequential step-up in revenue and case volumes from Q3 to Q4. And so there's really no changes there that we're anticipating that to occur again. We've seen it time to time again that's what happens. And so we feel like we're well positioned with the new products that we launched last year to benefit from as well as the new products that we're launching this year to continue to drive more case volume increases. And so we're looking forward to the back half of the year. Operator: And the next question is going to come from Ben Haynor with Lake Street Capital. Benjamin Haynor: First off for me on the great release and the CartiBlaster. Can you share a little bit on kind of how you see the addressable market sizes for those products? John Treace: Sure, Ben. It's John. Thanks for the question. What we've talked about is when you look at the combination of SuperBite, the HyperPlate XM and the CartiBlaster, GreatReleaseXM platform, we think that expands our TAM by about $300 million on the U.S. side. And that's basically the size of that opportunity that we're going after in this kind of mid-foot and hind-foot portfolio target. Benjamin Haynor: Perfect. That's helpful. On the Lapiplasty, surgeons that are picking up your other offerings, do they tend to gravitate towards one or the other? Or is there any -- are there any commonalities there? And also any commonalities on who you're displacing? John Treace: Yes. First, at a high level, we've assessed -- we're getting about -- we were -- before we launched the 3 new bunion system, we were getting around 25% on average of our surgeons overall bunion-related volume. As these new products have been driving into that customer base, what we're finding is based on the surgeon's preference on the MIS side, they may not want to use a burr and so they gravitate more towards Nanoplasty. That's one of our MIS systems that's an IM implant, and you don't have to learn how to use a rotary cutting burr. There is a learning curve established with that. And you have other surgeons that prefer to go the Percuplasty route. They want to use the burr or they've been using the burr at a time, so they choose that system. As for SpeedMTP, we're just seeing very, very strong adoption of that across the board, across all fronts. It's an outstanding system. Very, very low profile, great fusion plate with excellent stability and fixation. And as the name indicates, it goes on very quickly. So I'd say that's how the mix is playing out in our customer hands. Operator: And the next question will come from Rick Wise with Stifel. Frederick Wise: John, maybe going back to your starting comments about -- which I think is hats off to you and the team, but 40% of the base using at least one and 35% of the new docs pulling through Lapiplasty, et cetera, and obviously, more products to come. But I'm curious about what kind of competitive response you're seeing, what kind of competitive response you might -- we should imagine you might face. Obviously, you've got some tough competitors out there. How quickly can they imitate or replicate some of the innovations I'm sure you're bringing. Just how do we -- what are the challenges ahead from that front? John Treace: Rick, thanks for being here, and I appreciate the question. I guess at a high level, we haven't seen a notable shift on the competitive landscape since last quarter. As you know, we have numerous companies that participate in the bunion space, some very large companies and a lot of smaller players. The way we see it, we just have these very high-performing products in the segments that we play in. And what differentiates us as well is we have this incredible onboarding for surgeons through our best-in-class medical education, our super -- our bunion masters training events. We get rate reviews. Surgeons tell us these are the best in the industry, the best that they've ever attended. And then once the surgeons are trained, we give them the support of that highly trained, highly specialized sales team that really make sure they can integrate and adopt these new products into their practice, efficiently and effectively. And then we continue a very high pace of innovation where we're iterating and innovating our current platforms and then launching some new platforms. We talked about several new launches that are going to affect the fourth quarter, and we have a very robust pipeline of future technologies coming beyond that, that we'll be excited to talk about at a later date. So I think all those factors are helping us win in this competitive landscape, and that's the innovation formula we're going to keep driving. Frederick Wise: Great. And Mark, to pick on you a little bit, I wanted to follow up on Izzy's excellent question. Maybe we can get a little more clarity. I heard what you said about fourth quarter strength on the revenue side. But are we likely to think that you can -- given all the new products and the uptake that third quarter sales can be higher -- and this is sort of a 3-parter of clarification. You had an adjusted EBITDA loss of $3.5 million in the quarter, obviously, better or less bad, if you will, than the first quarter. Just given the trends in OpEx, is $50 million -- $50 million, $51 million your new quarterly OpEx run rate? Is that the range? And therefore, the dream of getting to adjusted EBITDA close to adjusted EBITDA breakeven in 2027, I mean, more credible in our mind? Mark Hair: Yes. Thanks, Rick. Let me start off. And if I miss any element of the question, just remind me what I missed here. But I think the first part of the question is our revenue. And we feel good about the way we're positioned to benefit from our new products to have that nice step-up in revenue in our seasonally strongest fourth quarter. So we plan for that every year. We want to ensure that our products are launched before that so our surgeons can benefit, we can benefit in that fourth quarter. And so we've done all those things this year as well. So we believe that we're going to have that step-up in the fourth quarter. And I'm going to take you back a little bit. We've been talking over the last several quarters, beginning last year, middle of last year that we talked about we did some restructuring changes. We've created some efficiencies in the organization. That process started last year, and we're annualizing and benefiting from some of those cost reductions and expense changes that we implemented last year. We'll benefit throughout this year. We did better in adjusted EBITDA in Q2 this year versus last year on a lower revenue base. And so we believe that there is improved leverage in the system. We also had some restructuring charges that we took this quarter, meaning our work isn't done. We continue to look for efficiencies throughout the organization. We believe we can improve some of the leverage, some of the benefits to the bottom line, and we want to do that in a way that's not going to hurt our investments into top line growth, meaning we continue to invest in our great R&D program. That team is developing great products. We're continuing to invest in the commercial sales force to ensure that we've got the right top line growth, commercial strategies in place, but we can also do that efficiently. And so we continue to look for places to do that. Now there are -- we did better in Q2 than what was anticipated. We feel really good about that. We're going to keep our heads down and keep doing what we've set out to do this year. And as you think about adjusted EBITDA into next year, it's a little early for me to talk about next year, but we feel very confident that we will have continued improvements. We have historically shown very strong positive adjusted EBITDA in the fourth quarter. We anticipate that we'll do that again this year and that we can be positive adjusted EBITDA next year as we think about our growth trajectories and all these commercial strategies. Did I answered all your points, Rick? Frederick Wise: Yes. Yes. I just want to make sure I'm understanding. I hear you on the fourth quarter revenue, of course. But I want to make sure, last year, third quarter sales stepped up over second. And I want to make sure that we're all on the same page and getting it right for you on the cadence. So the idea of a step-up in this year's third quarter along the way to that seasonally strong fourth quarter, third quarter sales being higher than second is a reasonable thought given everything that's happening. Mark Hair: It's absolutely reasonable thought given the step-up in our case volume increases and what we're seeing. So that's the way we've thought about the quarter and the trajectory, the cadence throughout this year. So yes, it's -- we will have a step-up in the third quarter versus Q2. That's the way we're thinking about it. That's what we believe will happen in anticipation of that stronger fourth quarter. So yes. Operator: And the next question is going to come from Richard Newitter with Truist. Richard Newitter: I wanted to just ask a little bit on the environment. We've pretty much through 2Q earnings here. We've seen kind of ortho players report their results. There's probably been some normalization. There's been some fears of elective procedure slowdown, ACA subsidy expiration. Can you guys talk a little bit about what -- obviously, you made progress in the quarter, you're raising your guidance, but you guys have some pretty idiosyncratic things going on, too. I'm looking for some color on what you're seeing in the elective procedure market you guys have a mixed exposure to that would be particularly insightful to kind of get a feel for whether or not there's any kind of step function change coming. So that's point one. And maybe just within the context of we're in bunion season or heading into bunion season, do you get the feel that, that bunion season is on track to be consistent with what normally plays out? Or is there hesitancy? That's question one, and then I'll have a follow-up. John Treace: Yes. Rich, thanks. It's John. Maybe I'll take a shot at this question, and Mark can clean up on anything I missed here. But we talked about the continued year-over-year case volume growth. We talked about the acceleration. We saw into high single digits in the quarter. We believe we're gaining market share. We're getting more adoption on these products. To date, I would say the underlying trends have kind of tracked with our assumptions that were built into our 2026 guidance. And then with more new products coming and impacting things in the back half of the year like SuperBite and the new products we talked about, we can tap into incrementally more elective cases that are outside what is going on in the bunion market specifically. With regard to some of the other commentary, ACA enrollment, et cetera, we're aware of that and the discussion around the impact on some elective procedures. I'd say at this point, we haven't seen a material impact on our elective patient demographic. We do have a pretty high percentage of our patient demographic that's commercially insured and maybe that's playing in there. So that's how I would sort of frame things right now from where we see things today. Richard Newitter: Okay. So you're not hearing anything from your customers. There's nothing that's suggesting that there's change coming or anything overly alarming. John Treace: We have not heard anything of material impact from our customer base. The summer season is typically softer for bunions in general, and that's just been our normal seasonality or at least how it's played over the last few years for us and nothing material that we're hearing from our customers that's making this sound like a much different summer season. Richard Newitter: Okay. That's helpful. And then just looking at the consensus for '27, I know you're obviously not going to guide to '27, but your jump-off point is a nice growth trajectory for 2026 implied by the guide. Is there any reason why you wouldn't be able to sustain on a full year basis next year, call it, high single-digit growth trajectory. That's roughly where the consensus is. And I'm just wondering if you could kind of opine on that at this point, whether you're kind of comfortable with that consensus being in that arena. Mark Hair: Yes, Rich, this is Mark. I appreciate the question. Yes, we feel really good about the way we plan to exit this year. It should be much stronger growth rates. We're pleased. We're looking forward to that fourth quarter. A lot of the headwinds that we talked about, some of the dynamics, the mix shift, a lot of these things begin to play out. So we expect some of that benefit to come in the fourth quarter. We definitely plan to have a different trajectory as we go into 2027. It's going to be a little bit early right now before we lock in what that range is going to be. But we feel really good as we exit this year that we're -- we'll have some wind in our sales. And there will be some -- as always, there's going to be some different quarters and challenges to overcome, but we're going to feel really good about the fourth quarter. So I think for now, we just want to -- we want to keep our heads down. We want to execute on the fourth quarter, and then we'll give a little bit more color about what kind of growth rates we think we can have for next year. But we're excited about what this year will bring. Operator: And the next question will come from Lilia Lozada with JPMorgan. Lilia-Celine Lozada: Maybe just one for me. I'm hoping you could talk a bit more about price. I know some of the new MIS osteotomy products come at a lower ASP. But at the same time, you've been adding a lot of new products to the bag. So what does that all mean for average procedure price moving forward? And how far through the mix headwinds from the new MIS osteotomy products are you? John Treace: Thanks, Lily. Yes, we continue to have that mix dynamic -- ASP mix dynamic, and that's going to play through Q3 where we launched these products last year. So we're seeing kind of what we expect on our trends there when we look at an average blended selling price on these products. As we launch things like SuperBite, you have 2 different places those go. Sometimes SuperBite screws go into our existing Lapiplasty, Adductoplasty procedures where they're an add-on sale, and they may be a $500 or $1,000 or $1,500 addition to a case like that. They can be used stand-alone. And that may be a case that varies between $500 and call it, $2,000. When you get into cases in the -- more in the back of the foot, sometimes these combine multiple technologies. So you have SuperBite screws, you have our SpeedPlate or our forthcoming HyperPlate. You have some of our biologics involved. And these can be $5,000, $10,000, even $15,000 cases. So there's really a pretty big blend of the way some of these new platforms are going to roll out, that are going to -- I think average out together to be pretty nice for us. And just overall strengthen our portfolio, strengthen our surgeons relationships with their reps and get our sales reps called into a lot more cases during the third quarter and the fourth quarter of this year than they maybe were last year. So we're excited about that. Operator: And I am showing no further questions in the queue at this time. This will conclude today's conference call, and thank you for participating, and you may now disconnect. 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Interested in Treace Medical Concepts, Inc.? Here are five stocks we like better. Q2 revenue fell 4% to $45.4 million, pressured by lower stocking-distributor kit sales and a shift toward lower-priced minimally invasive products. However, procedure-volume growth accelerated to the high-single-digit range, while the net loss and adjusted EBITDA loss improved year over year. Treace raised its 2026 revenue outlook to $204 million–$212 million and narrowed its adjusted EBITDA loss forecast to $3 million–$5 million. Management expects revenue growth to resume in the fourth quarter and anticipates positive adjusted EBITDA in that period. Adoption of the Nanoplasty, Percuplasty and SpeedMTP bunion systems expanded, with 40% of Lapiplasty surgeons using at least one new platform. The company is also broadening its foot-and-ankle portfolio, with new products expected to expand its U.S. addressable market by approximately $300 million. Treace Medical Concepts (NASDAQ:TMCI) reported second-quarter 2026 revenue of $45.4 million, down 4% from the prior-year period, as lower procedure-kit sales to stocking distributors and a continued shift toward lower-priced minimally invasive products weighed on reported sales. Chief Executive Officer John Treace said the company saw accelerating year-over-year procedure volume growth, reaching the high-single-digit range during the quarter. Excluding stocking-distributor sales, the company sold more procedure kits than it did in the second quarter of 2025, according to Chief Financial Officer Mark Hair. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth The company raised its full-year revenue outlook, while also narrowing its projected adjusted EBITDA loss range. Management said it expects revenue growth to return in the fourth quarter, which it described as its seasonally strongest period. Treace reported a second-quarter net loss of $15.9 million, or $0.24 per share, compared with a loss of $17.4 million, or $0.28 per share, a year earlier. Gross margin was 78.5%, compared with 79.7% in the prior-year quarter. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High Total operating expenses declined 8% to $50.6 million. Adjusted EBITDA was a loss of $3.5 million, slightly improved from a $3.6 million loss in the second quarter of 2025. Hair said the company’s year-to-date cash usage fell 57%, or $3.6 million, from the comparable period last year. Cash, cash equivalents and marketable securities totaled $45.6 million as of June 30. Full-year 2026 revenue guidance was raised to $204 million to $212 million, from prior guidance of $202 million to $212 million. The revised range implies a revenue decline of 4% to flat compared with full-year 2025. Adjusted EBITDA guidance was updated to a loss of $3 million to $5 million, compared with earlier guidance for a loss of $4 million to $6 million. The company reiterated its expectation for approximately a 50% reduction in cash usage for 2026 versus 2025. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling Hair said revenue declines are expected to persist until the fourth quarter. He added that management expects third-quarter revenue to increase sequentially from the second quarter before a larger seasonal step-up in the fourth quarter. Management attributed the improvement in procedure volume partly to adoption of three bunion systems launched in the third quarter of 2025: Nanoplasty, Percuplasty and SpeedMTP. The systems are intended to extend Treace’s reach beyond its Lapiplasty platform. Treace said about 40% of its Lapiplasty surgeon-user base had used at least one of the three newer bunion systems through the second quarter, up from 35% reported in the first quarter. The company has more than 3,300 existing surgeon customers. Treace said Lapiplasty has historically captured about 25% of the bunion-related procedure volume performed by its surgeon customers, on average. Management views the newer platforms as addressing much of the remaining procedure opportunity, including minimally invasive osteotomy procedures and MTP fusion procedures. About 30% of surgeons who initially became Treace customers through one of the three new bunion systems have also used Lapiplasty, management said, which it described as a pull-through effect for the flagship technology. During the question-and-answer session, John Treace said surgeons who prefer minimally invasive procedures without use of a rotary cutting burr have tended to gravitate toward Nanoplasty, while surgeons already familiar with burr-based techniques may choose Percuplasty. He said SpeedMTP has experienced broad adoption across the company’s customer base. Treace also discussed efforts to broaden its portfolio beyond bunion correction and participate in more foot and ankle procedures performed by its surgeon customers. During the second quarter, the company initiated a limited commercial release of its SuperBite compression screw system. Treace expects to fully commercialize SuperBite during the third quarter. The system is designed with self-drilling and countersinking features intended to reduce or, in some cases, eliminate pre-drilling. Management said SuperBite can be used as an add-on in existing Lapiplasty and Adductoplasty procedures, as well as in stand-alone procedures. John Treace said the revenue contribution can vary widely depending on the procedure and accompanying products, ranging from several hundred dollars for certain uses to larger cases incorporating multiple implants and biologics. The company also completed initial cases using its HyperPlate XM dynamic compression locking implant technology for midfoot and hindfoot fusion applications. Treace recently commercialized its GreatReleaseXM instrument, designed to help surgeons access and prepare larger joints for fusion. In the fourth quarter, Treace plans to introduce CartiBlaster powered joint-preparation rasps for midfoot and hindfoot fusion procedures. In response to an analyst question, John Treace said the combined opportunity for SuperBite, HyperPlate XM, CartiBlaster and GreatReleaseXM expands the company’s U.S. total addressable market by about $300 million. Treace said it remains on track for a limited commercial launch of its next-generation Lapiplasty Lightning platform in the fourth quarter. The platform includes new 3D correction instrumentation and SpeedTMT implants designed to simplify workflow, reduce procedure time and improve surgeon control over correction. The company also highlighted IntelliGuide, its patient-specific planning and cut-guide system for Lapiplasty bunion and Adductoplasty midfoot corrections. Management said the anticipated fourth-quarter improvement should be supported by accelerating case volumes, the annualization of product-mix effects from the 2025 bunion launches and contributions from products introduced in 2026. Hair said the company expects to report positive adjusted EBITDA in the fourth quarter and anticipates continued profitability improvement in 2027, though he said it was too early to provide detailed guidance for next year. Addressing the elective-procedure environment, John Treace said the company had not seen a material impact on its patient population and had not heard indications from customers of a significant change in seasonal demand. He noted that bunion procedures are typically softer during the summer months. Treace Medical Concepts, Inc is a medical technology company specializing in the development and commercialization of innovative surgical solutions for foot and ankle conditions. The company's flagship product, the Lapiplasty 3D Bunion Correction System, addresses the underlying joint instability that causes bunion deformity through a patented, multi-plane correction approach. The system combines proprietary instrumentation, fixation plates, and a comprehensive surgical protocol designed to improve patient outcomes and reduce recurrence rates. The Lapiplasty System has received clearance from the U.S. 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 "Treace Medical Concepts Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

PONTE VEDRA, Fla., Aug. 07, 2026 (GLOBE NEWSWIRE) -- Treace Medical Concepts, Inc. (“Treace” or the “Company”) (NasdaqGS: TMCI), a medical technology company driving a fundamental shift in the surgical treatment of bunions and related deformities, today reported financial results for the second quarter ended June 30, 2026. Recent Highlights Generated revenue of $45.4 million in the second quarter 2026 compared to $47.4 million in the same period in 2025. Reported second quarter 2026 net loss of $(15.9) million and adjusted EBITDA of $(3.5) million in the second quarter 2026. Reduced year-to-date cash usage by 57% or $3.6 million when compared to the same period in 2025. Cash, cash equivalents, and marketable securities totaled $45.6 million as of June 30, 2026. Initiated limited market release of SuperBite™ Compression Screw System and completed the first surgical case with HyperPlate™ XM Dynamic Compression Locking Implant System. Increased adoption of expanded bunion portfolio with approximately 40% of Lapiplasty® surgeon users incorporating one or more of its three new bunion systems launched in the third quarter 2025 from 35% in the first quarter of 2026. “We are pleased with our second quarter results which were driven by accelerating year-over-year case volumes and market share gains resulting from increasing surgeon adoption of our comprehensive bunion portfolio as well as our expanding line of new technologies – now providing us access to a broader range of procedures throughout the foot & ankle,” said John T. Treace, CEO and Chairman of Treace Medical. “We continue to focus on investing in growth initiatives to leverage our expanded portfolio, while driving profitability, positioning us for stronger growth in the second half of the year.” Second Quarter 2026 Financial Results Revenue for the second quarter of 2026 was $45.4 million, representing a decrease of 4% compared to $47.4 million in the second quarter of 2025, and a sequential improvement in year-over-year growth rate. Gross profit for the second quarter of 2026 was $35.6 million compared to $37.8 million in the second quarter of 2025. Gross margin was 78.5% in the second quarter of 2026, compared to 79.7% in the second quarter of 2025. Total operating expenses decreased 8% to $50.6 million in the second quarter of 2026 and decreased by $4.2 million compared to total operating expenses of $54.7 million in the second quarter of 2025, primarily driven by targeted expense reduction initiatives across the organization. Second quarter 2026 net loss was $(15.9) million, or $(0.24) per share, compared to $(17.4) million, or $(0.28) per share, for the same period in 2025. Adjusted EBITDA was $(3.5) million in the second quarter of 2026 compared to $(3.6) million for the same period in 2025. The financial tables and description below provide additional information and a reconciliation of non-GAAP financial information. Year-to-date cash usage was reduced by 57% or $3.6 million when compared to the same period in 2025. Cash, cash equivalents, and marketable securities totaled $45.6 million as of June 30, 2026. The Company’s existing credit facility provides an additional $115 million of liquidity subject to certain conditions. 2026 Financial Outlook The Company is raising its full-year 2026 revenue guidance to be in the range of $204 million to $212 million, representing a decline of 4% to 0% compared to full-year 2025. This compares to previous revenue guidance of $202 million to $212 million. The Company is updating its expectation of a loss in Adjusted EBITDA in the range of $3.0 million to $5.0 million for full year 2026, as compared to previous guidance of a loss in the range of $4.0 million to $6.0 million. The Company reported a loss of $3.9 million in the full-year 2025.* The Company reiterates its expectation for a reduction in cash usage of approximately 50% for full-year 2026 as compared to the full year 2025. The Company’s full-year 2026 guidance assumes continued case volume growth and improving year-over-year growth rates for the second half of the year as headwinds are annualized. Webcast and Conference Call Details Treace will host a conference call today, August 7, 2026, at 8:00 a.m. ET to discuss its second quarter 2026 financial results. Investors interested in listening to the conference call may do so by registering. The live webcast of the conference call will be available on the Investor Relations section of the Company’s website at investors.treace.com. The webcast will be archived on the website following the completion of the call. Use of Non-GAAP Financial Measures To supplement the financial results presented in accordance with GAAP, this earnings release presents Adjusted EBITDA, which the Company defines as net loss before depreciation and amortization expense, interest income, interest expense, taxes, share-based compensation expense, acquisition-related costs, restructuring costs, customer credit loss, litigation costs, and debt extinguishment loss. Non-GAAP financial measures such as Adjusted EBITDA are presented in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Management uses non-GAAP financial measures to evaluate the Company’s operating performance and trends, as well as for making planning decisions. The Company believes that Adjusted EBITDA helps to identify underlying trends in the Company’s business that may otherwise be masked by the effect of the income and expenses and other items that it excludes in its calculation of Adjusted EBITDA. Accordingly, the Company believes this non-GAAP financial measure provides useful information to investors and others in understanding and evaluating the Company’s operating results, enhancing the overall understanding of its past performance and future prospects, and allowing for greater transparency with respect to key financial metrics used by the Company’s management in their financial and operational decision-making. The Company also presents this non-GAAP financial measure because it believes investors, analysts and rating agencies consider it to be a useful metric in measuring the Company’s performance against other companies and its ability to meet its debt service obligations. There are limitations related to the use of non-GAAP financial measures such as Adjusted EBITDA because they are not prepared in accordance with GAAP, may exclude significant income and expenses required by GAAP to be recognized in the Company’s financial statements, and may not be comparable to non-GAAP financial measures used by other companies. The Company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. A reconciliation between GAAP and non-GAAP results is presented below. *A reconciliation of Adjusted EBITDA to GAAP net loss on a forward-looking basis is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to the items excluded from this non-GAAP measure. Forward-Looking Statements This press release and statements made during the Company’s earnings call contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, the Company’s: 2026 full-year guidance; anticipated liquidity; 2026 Adjusted EBITDA guidance; expected 2026 cash usage decrease; anticipated return to stronger growth in the second half of the year; anticipated continued case volume growth; expected increase in product adoptions, portfolio utilization and market share; continued execution of commercial and other strategic initiatives; ability to effectively respond to and mitigate the impact of challenges in the current market environment, including in response to increased competition, evolving surgeon and patient preferences for minimally invasive bunion solutions, changes in tariffs and trade policies, protracted government shutdowns, and lower patient demand for elective bunion surgery due to macroeconomic uncertainty and soft consumer sentiment; anticipated future product launches and the timing of such product launches; ability to increase procedure volumes, expand surgeon relationships and utilization rate, and increase procedure penetration and market share; ability to protect and enforce its intellectual property rights, including through its patent infringement and unfair competition suits; success in defending against securities class actions and infringement of its intellectual property by third parties, including its competitors; expected seasonality; ability to leverage investments in its commercial organization and control costs in its organizational structure; anticipated expansion of clinical evidence; the amount and timing of orders for our products from stocking distributors and other customers; and anticipated pace of growth in the foot and ankle market. Forward-looking statements are based on management’s current assumptions and expectations of future events and trends, which affect or may affect the Company’s business, strategy, operations or financial performance, and actual results and other events may differ materially from those expressed or implied in such statements due to numerous risks and uncertainties. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Factors that could cause actual results or other events to differ materially from those contemplated in this press release can be found in the Risk Factors section of Treace’s public filings with the Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on February 27, 2026. Because forward-looking statements are inherently subject to risks and uncertainties, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements speak only as of their date and, except to the extent required by law, the Company undertakes no obligation to update these statements, whether as a result of any new information, future developments or otherwise. The Company’s results for the quarter ended June 30, 2026 are not necessarily indicative of its operating results for any future periods. Internet Posting of Information Treace routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.treace.com. The Company encourages investors and potential investors to consult the Treace website regularly for important information about Treace. About Treace Medical Concepts Treace Medical Concepts, Inc. is a medical technology company with the goal of being the recognized leader in the surgical treatment of bunions and related deformities. Bunions are complex 3-dimensional deformities that originate from an unstable joint in the middle of the foot and affect approximately 67 million Americans, of which Treace estimates 1.1 million are annual surgical candidates. Treace has pioneered and patented the Lapiplasty®3D Bunion Correction® System – a combination of instruments, implants, and surgical methods designed to surgically correct all three planes of the bunion deformity and secure the unstable joint, addressing the root cause of the bunion and helping patients get back to their active lifestyles. To further support the needs of surgeons and bunion patients, Treace offers its Adductoplasty® Midfoot Correction System, designed for reproducible surgical correction of midfoot deformities, two systems for minimally invasive osteotomy procedures, namely the Nanoplasty® 3D Minimally Invasive Bunion Correction System and the Percuplasty® Percutaneous 3D Bunion Correction System, and the SpeedMTP® MTP Fusion System. Treace continues to expand its footprint in the marketplace by extending its SpeedPlate® rapid compression implant platform to new applications, providing surgeons with advanced digital solutions with its IntelliGuide® patient specific, pre-op planning and cut guide technology, and offering SuperBite™ fully-threaded compression screws for use in fusions throughout the foot. For more information, please visit www.treace.com. To learn more about Treace, connect with us on LinkedIn, X, Facebook and Instagram. Contacts: Treace Medical ConceptsMark L. HairChief Financial [email protected](904) 373-5940 Investors:Gilmartin GroupPhilip Trip Taylor [email protected]

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. The sequential improvement in revenue growth rate was driven by high single-digit case volume acceleration and increased surgeon adoption of the comprehensive bunion portfolio. Management attributed the year-over-year revenue decline to lower procedure kit sales to stocking distributors and a continued mix shift toward lower-priced minimally invasive products. The company is successfully expanding its addressable market by capturing the 75% of bunion procedures previously unaddressed by its core Lapiplasty system. Approximately 40% of the existing surgeon base has utilized at least one of the three new bunion systems launched in late 2025, up from 35% in the prior quarter. A 'pull-through' effect is emerging, where 30% of new surgeons who first adopted the newer bunion systems have subsequently utilized Lapiplasty technology. Strategic expansion into mid-foot and hind-foot procedures via the SuperBite system is enabling the sales force to capture a greater share of surgeon wallet across the entire foot. Profitability improved through organizational efficiencies and restructuring, resulting in reduced cash usage and better adjusted EBITDA leverage despite a lower revenue base. Full-year 2026 revenue guidance was raised to $204 million to $212 million, assuming a return to positive growth in the seasonally strongest fourth quarter. The fourth quarter recovery is predicated on accelerating case volumes and the annualization of the ASP mix shift dynamics from 2025 product launches. Management expects a limited commercial launch of the next-generation Lapiplasty Lightning platform in the fourth quarter to simplify surgical workflows and enhance accuracy. The company anticipates a 50% reduction in cash usage for the full year 2026, supported by continued operational discipline and restructuring benefits. Strategic focus remains on the full commercialization of the SuperBite system and the introduction of the CartiBlaster joint preparation rasps to strengthen the mid- and hind-foot portfolio. Restructuring charges were taken during the quarter as the company continues to seek organizational efficiencies and improved bottom-line leverage. The company identified a $300 million incremental U.S. addressable market opportunity through its new mid-foot and hind-foot product combinations. Management noted that while the summer season is typically softer for bunion procedures, they have not seen a material impact from macro factors like ACA subsidy expirations. Direct sales channels now account for approximately 80% of total revenue, providing a focused platform for new technology launches. Case volume growth accelerated to high single digits, driven by deeper penetration of the three new bunion systems and early uptake of the SuperBite screw system. Management confirmed that 40% of their 3,300-surgeon base has now adopted at least one of the new systems launched in Q3 2025. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. The combination of SuperBite, HyperPlate XM, and CartiBlaster expands the company's total addressable market by approximately $300 million in the U.S. These products allow the company to participate in procedures ranging from the forefoot to the hind-foot, which often utilize additional Treace products. Management has not observed a notable shift in the competitive landscape and believes their high-performing products and best-in-class medical education provide a defensive moat. The innovation strategy focuses on a high pace of iteration to maintain leadership in the 3D bunion correction segment. Management expects a sequential revenue step-up in Q3 followed by a very strong Q4, which historically generates positive adjusted EBITDA. While too early for formal 2027 guidance, the company expressed confidence in continued profitability improvements and a stronger growth trajectory exiting 2026. Treace has not seen a material impact from reported elective procedure slowdowns, noting a high percentage of their patient demographic is commercially insured. Current underlying trends are tracking in line with the assumptions built into the original 2026 guidance.

This article first appeared on GuruFocus. Revenue: $45.4 million in Q2 2026, a decrease of 4% compared to the prior year period. Gross Margin: 78.5% in Q2 2026, compared to 79.7% in Q2 2025. Operating Expenses: Decreased 8% to $50.6 million in Q2 2026, compared to $54.7 million in Q2 2025. Net Loss: $15.9 million, or $0.24 per share, in Q2 2026, compared to a net loss of $17.4 million, or $0.28 per share, in Q2 2025. Adjusted EBITDA: Loss of $3.5 million in Q2 2026, compared to a loss of $3.6 million in Q2 2025. Cash Usage: Reduced by 57% or $3.6 million year-to-date compared to the same period in 2025. Cash Position: Cash, cash equivalents, and marketable securities totaled $45.6 million as of June 30, 2026. Full-Year 2026 Revenue Guidance: Raised to a range of $204 million to $212 million, representing a decline of 4% to 0% compared to full year 2025. Full-Year 2026 Adjusted EBITDA Guidance: Updated to a loss in the range of $3 million to $5 million. Warning! GuruFocus has detected 5 Warning Signs with TMCI. Is TMCI fairly valued? Test your thesis with our free DCF calculator. Release Date: August 07, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Revenue growth rate improved sequentially with case volume growth accelerating to high single-digits in Q2 2026. Adjusted EBITDA loss narrowed to $3.5 million in Q2 2026, showing improved profitability and leverage. Cash usage reduced by 57% year-to-date, strengthening the balance sheet. 40% of the Lapiplasty surgeon base has adopted at least one of the three new bunion systems, up from 35% in Q1. New product launches (SuperBite, HyperPlate XM, GreatRelease XM) are expanding the addressable market and driving adoption. Revenue declined 4% year-over-year in Q2 2026 due to lower stocking distributor sales and a mix shift to lower-priced products. Gross margin decreased to 78.5% from 79.7% in the prior year quarter. The company still reported a net loss of $15.9 million in Q2 2026. Full-year 2026 revenue guidance implies a decline of up to 4% compared to 2025, with continued revenue declines expected until Q4. The ASP mix shift from new MIS products is expected to persist through Q3 2026, pressuring revenue growth. Q: Can you discuss the quarter-over-quarter improvements in volume and pricing, and whether these dynamics have improved with the new products brought to market? A: John Treace (CEO) noted that the quarter saw greater penetration of the three new Bunion systems launched in Q3 2025, with usage among the 3,300-surgeon base increasing from 35% to 40%. Contributions from the limited market release of the SuperBite screw system also helped accelerate case volume growth to high single-digits, up from mid single-digits in prior quarters. Q: How should we think about the pacing of revenue in the third and fourth quarters of 2026? A: Mark Hair (CFO) stated that the company expects continued improvement in case volumes and more contributions from new products in the back half of the year. He reiterated that the fourth quarter is always the seasonally strongest, with an anticipated sequential step-up in revenue and case volumes from Q3 to Q4, supported by the annualization of mix shift dynamics and 2026 product launches. Q: What is the size of the addressable market for the new midfoot and hindfoot products like GreatRelease and CartiBlaster? A: John Treace (CEO) explained that the combination of SuperBite, HyperPlate XM, CartiBlaster, and GreatRelease XM expands the company's US total addressable market by approximately $300 million, targeting the midfoot and hindfoot fusion segment. Q: Are there commonalities in how Lapiplasty surgeons are adopting the new offerings, and who are they displacing? A: John Treace (CEO) noted that surgeon preference drives adoption, with some gravitating toward Nanoplasty (an MIS system without a burr) and others toward Percuplasty (which uses a burr). The SpeedMTP system is seeing strong adoption across the board due to its low profile and excellent stability. Before the launches, Treace captured about 25% of surgeons' bunion-related volume, and the new systems are designed to address the remaining 75%. Q: What competitive responses are you seeing, and how quickly can competitors replicate your innovations? A: John Treace (CEO) stated there has been no notable shift in the competitive landscape. He highlighted Treace's differentiation through high-performing products, best-in-class medical education (Bunion Masters training), a highly trained sales team, and a high pace of innovation with a robust pipeline of future technologies. Q: Can you provide more clarity on the revenue cadence and the path to adjusted EBITDA breakeven? A: Mark Hair (CFO) confirmed that Q3 revenue is expected to step up from Q2, leading into a stronger Q4. He noted that Q2 adjusted EBITDA improved year-over-year on a lower revenue base, reflecting improved leverage from restructuring and efficiency initiatives. He expressed confidence in continued improvements and the potential for positive adjusted EBITDA in 2027, though it is too early to provide specific guidance. Q: What are you seeing in the elective procedure market, and is bunion season tracking as expected? A: John Treace (CEO) reported continued year-over-year case volume growth and market share gains. He stated that underlying trends have tracked with assumptions built into 2026 guidance, and the company has not seen a material impact from ACA enrollment changes or elective procedure slowdowns. The summer season is typically softer for bunions, and nothing suggests this year will be materially different. Q: Can you sustain a high single-digit growth trajectory in 2027, and are you comfortable with consensus estimates? A: Mark Hair (CFO) said the company feels good about its exit from 2026, with stronger growth rates expected in Q4 as headwinds from mix shift begin to play out. While it is too early to lock in a 2027 range, he expressed confidence in the trajectory and stated the company will provide more color after executing on the fourth quarter. Q: What does the mix of new products mean for average procedure price, and how far through the ASP headwind are you? A: John Treace (CEO) acknowledged the ASP mix dynamic will continue through Q3 due to the 2025 launches. However, new products like SuperBite can be add-on sales ($500-$1,500) or standalone cases ($500-$2,000), while complex midfoot/hindfoot cases combining multiple technologies can reach $5,000-$15,000. This blend is expected to strengthen the portfolio and increase rep involvement in cases. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

PONTE VEDRA, Fla., July 24, 2026 (GLOBE NEWSWIRE) -- Treace Medical Concepts, Inc. (“Treace” or the “Company”) (NasdaqGS: TMCI), a medical technology company driving a fundamental shift in the surgical treatment of bunions and related midfoot deformities, today announced that it will release financial results for the second quarter 2026 before the start of trading on Friday, August 7, 2026. Company management will host a conference call to discuss financial results beginning at 8:00 am ET. Investors interested in listening to the conference call may do so by registering. Once registered, participants will receive dial-in numbers and a unique pin to join the call and ask questions. A live and archived webcast of the event will be available on the Company’s investor relations website at https://investors.treace.com/. Internet Posting of InformationTreace routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.treace.com. The Company encourages investors and potential investors to consult the Treace website regularly for important information about Treace. About Treace Medical ConceptsTreace Medical Concepts, Inc. is a medical technology company with the goal of advancing the standard of care for the surgical management of bunion and related midfoot deformities. Bunions are complex 3-dimensional deformities that originate from an unstable joint in the middle of the foot and affect approximately 67 million Americans, of which Treace estimates 1.1 million are annual surgical candidates. Treace has pioneered and patented the Lapiplasty® 3D Bunion Correction® System – a combination of instruments, implants, and surgical methods designed to surgically correct all three planes of the bunion deformity and secure the unstable joint, addressing the root cause of the bunion and helping patients get back to their active lifestyles. To further support the needs of surgeons and bunion patients, Treace offers its Adductoplasty® Midfoot Correction System, designed for reproducible surgical correction of midfoot deformities, two systems for minimally invasive osteotomy procedures, namely the Nanoplasty® 3D Minimally Invasive Bunion Correction System and the Percuplasty™ Percutaneous 3D Bunion Correction System, and the SpeedMTP® System. Treace continues to expand its footprint in the marketplace by extending its SpeedPlate® rapid compression implant platform to new applications, as well as providing surgeons with advanced digital solutions with its IntelliGuide® patient specific, pre-op planning and cut guide technology. For more information, please visit www.treace.com. To learn more about Treace, connect with us on LinkedIn, X, Facebook and Instagram. Contacts:Treace Medical ConceptsMark L. HairChief Financial [email protected](904) 373-5940 Investors:Gilmartin GroupPhilip Trip [email protected]

Image source: The Motley Fool. Friday, May 8, 2026 at 8 a.m. ET Chief Executive Officer — John Treace Chief Financial Officer — Mark Hair John Treace, Chief Executive Officer; and Mark Hair, Chief Financial Officer. John and Mark will discuss our first quarter financial results and 2026 outlook. We will then host a question-and-answer session following our prepared remarks. Our press release can be found in the Investor Relations section of our website at investors.treace.com. This call is being recorded and will be archived in the Investors section of our website. Before we begin, we would like to remind you that it is our intent that all forward-looking statements made during today's call will be protected under the Private Securities Litigation Reform Act of 1995. Any statements that relate to expectations or predictions of future events, market trends as well as our estimated results or performance are forward-looking statements. All forward-looking statements are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. All forward-looking statements are based upon currently available information and Treace Medical assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these statements. Please refer to our SEC filings, including our 2025 Form 10-K and our Form 10-Q for the first quarter of 2026 filed before the market opens today, May 8, which can be found in the Investor Relations section of our website at investors.treace.com for a detailed presentation of risks. With that, I will now turn the call over to John. John Treace: Thank you, Trip. Good morning, everyone, and thank you for joining us on our first quarter 2026 earnings conference call. Entering 2026, Treace Medical has evolved beyond its foundation in Lapiplasty into a comprehensive bunion solutions company. Building on the strategic progress made in 2025, we've expanded our portfolio with multiple new procedure innovations, which we believe position us to address a broad spectrum of surgeon and patient preferences across all bunion classes. We expect this breadth of offerings will support accelerated growth in procedure volume, increased wallet share and a meaningfully expanded serviceable market opportunity. We are encouraged by our first quarter performance but remain focused on driving further improvement. We continue to execute on controllable levers, including continuing to strengthen our sales team, launching meaningful product innovations and adding new accounts and surgeons. Importantly, the sustained mid-single-digit case volume momentum to start the year reinforces our confidence in our strategy to expand market penetration and improve top line growth as we move through 2026. At the same time, we also meaningfully reduced cash burn as we progress towards cash flow breakeven. I do want to note the dynamics that impacted 2025, including macro pressures on procedure demand and portfolio mix shifts, remain present. We reported revenue declines of approximately 10% in Q1, and we believe this trend will improve over time as we annualize the launch of the new products we launched in 2025, and we believe we're well positioned to navigate these factors and drive long-term growth. As such, we're reaffirming our outlook for full year 2026 revenue, which was raised when we preannounced our results on April 9 to be in the range of $202 million to $212 million, representing a decline of 5% to 0% compared to full year 2025. We expect revenue declines to improve through the rest of the year with revenue growth returning in our seasonally strongest fourth quarter. As mentioned, we expect fourth quarter revenue growth will largely be supported by case volume growth, the lapping of the ASP mix shift dynamics as well as the contributions from our planned 2026 product launches. Now I'd like to turn to our 3 strategic initiatives to drive top line growth and the progress we've made on these initiatives in the first quarter of 2026. First, leveraging our large existing customer base to drive adoption of the 3 new bunion systems that we commercialized in 2025; second, continuing to build upon our leadership position with Lapiplasty by launching new technologies that can appeal to new surgeon users; and third, expanding our product offerings to grow wallet share and tap into new TAM-expanding procedural adjacencies. First, let me begin with an overview on the bunion technologies we introduced in 2025, including their strategic relevance and early market reception. We believe these 3 new systems more than double our accessible market relative to Lapiplasty alone, making their successful commercialization and deeper market penetration an important priority as we look to drive incremental growth. Our Nanoplasty and Percuplasty 3D MIS Systems expand our reach into the high-volume osteotomy segment, which represents approximately 70% of the estimated 450,000 annual U.S. bunion procedures. Today, we believe only around 15% of metatarsal osteotomies are effectively being performed using MIS approaches, largely due to steep learning curves, variability in outcomes and limited correction of the third frontal plane of the deformity, which is associated with higher recurrence rates. Our 2 3D minimally invasive osteotomy systems are designed to address these challenges with more reproducible, instrumented procedures that can be easier to adopt and are designed to correct all 3 planes of the bunion deformity. We believe this positions us well to expand adoption and drive greater penetration over time across the estimated 4.4 million annual U.S. bunion sufferers. Now speaking to our SpeedMTP Great Toe Fusion System. SpeedMTP targets the roughly 20% of bunion patients who have developed an arthritic great toe or MTP joint. Additionally, SpeedMTP addresses a separate population of non-bunion patients who suffer from an isolated arthritic MTP joint. This is a large and strategically important market segment for Treace to participate and to innovate in given that MTP fusion is among the most common foot and ankle procedures performed. Across our growing base of over 3,300 surgeon customers, we estimate Lapiplasty currently captures about 25% of their bunion-related procedure volume. These 3 new systems are intended to target the remaining 75%, representing a significant opportunity for continued penetration and growth. Market penetration with these 3 products is increasing. While just 3 quarters into our full launch, we continue to see a strong uptake of our new systems and a corresponding acceleration in our procedure volumes, resulting in market share gains. As of Q1, approximately 35% of our Lapiplasty surgeon user base has incorporated at least one of these 3 new bunion systems into their practice since launch. This represents an increase over the 25% that we reported in the fourth quarter of 2025. We're also encouraged to see that approximately 30% of our new surgeons who became Treace customers by initially using one of the 3 new bunion systems have also used Lapiplasty technology, which we believe indicates a pull-through to Lapiplasty technologies. Second, at the same time, we remain highly focused on advancing our leadership in Lapiplasty and expanding its appeal and adoption across a broader surgeon audience. Lapidus Fusion represents approximately 30% of the 450,000 annual U.S. bunion procedures and is the largest segment, where we are the recognized category leader. And we remain on track to commercialize our next-generation Lapiplasty platform, known as Lapiplasty Lightning later this year. This system offers next-generation 3D correction instrumentation and new SpeedTMT implants. Lightning Instrumentation is designed to deliver a faster procedure by reducing procedure steps while also offering enhanced precision and enhanced control for the 3D correction, while SpeedTMT implants, as the name indicates, are designed to provide faster fixation application. Expanding surgeon interest and uptake of Lapiplasty also includes advancing our IntelliGuide PSI technology, the first patented preoperative planning and patient-specific cut guide system for bunion and midfoot correction in the U.S. Together with Lapiplasty Lightning and SpeedTMT, we believe these 3 core innovations position us well to extend our category leadership and drive further adoption in 2026 and beyond. Now turning to our third initiative, expanding our offerings to more broadly serve our growing customer base. In addition to our 3 new bunion systems, we expanded our portfolio with the addition of new SpeedPlate implants, new sterile instruments and we introduced our first biologics offerings. These additions are designed to enable our sales force to more comprehensively support their surgeons' needs while also increasing access to additional procedures. With this expanded portfolio, not only are we seeing growth in bunion-related adjacent procedures, but our sales team is now servicing some of their customers' incremental procedures outside of bunions as well. Building on this trend, in 2026, we are launching new technologies aimed at both increasing wallet share and expanding our access to incremental procedure volumes. Our SuperBite variable pitch compression screw system represents another differentiated technology from Treace. Compression screws are a fundamental fixation technology utilized in foot and ankle surgery. And without this high-volume fixation offering in our portfolio, competitive sales reps have supplied these products where needed in Treace cases. We announced initial surgeries with our SuperBite screws in April, and we're hearing positive early responses from surgeon users and high enthusiasm from our sales reps in our early commercial experience. Not only are SuperBite screws built with an advanced features based on the latest MIS customer preferences, but they're also designed to save OR time by reducing or eliminating altogether the need to pre-drill before implanting the screw due to their novel self-drilling design. The strategic addition of SuperBite to our portfolio not only reduce the need for a competitor in our cases, but importantly, they equip our sales force to gain access to a broader range of procedures ranging from the forefoot to the midfoot to the hindfoot and to the ankle. And complementing our expanded procedure access with SuperBite, we will target improving outcomes for challenging midfoot and hindfoot fusion procedures with our forthcoming SpeedXM Fusion System launch. SpeedXM leverages our novel SpeedPlate hybrid technology, delivering the benefits of dynamic compression and locking screw stability in a specialized anatomic design to address fusions of the larger bones of the midfoot and the hindfoot. SpeedXM plates are highly complementary with SuperBite screws and/or biologics as these technologies are often used in these larger bone fusion procedures. Importantly, these new products are serving procedures already performed by our existing surgeon customers in the same setting of care and often on the same day as our surgeons bunion cases. These new offerings leverage our sales force's presence and expertise and we believe can drive greater selling efficiency and impact. We expect full commercialization of both SuperBite and SpeedXM during Q3, collectively expanding our total addressable market by approximately $300 million and providing access to attractive high ASP midfoot and hindfoot procedures where multiple Treace technologies are often needed. Our strategy to build a comprehensive, best-in-class bunion solutions platform is gaining traction, supported by encouraging early indicators across the business. We continue to expand our active surgeon base while increasing utilization as adoption of our broader portfolio grows, driving mid-single-digit procedure volume growth in the first quarter, which we believe supports our approach. Looking ahead, we believe we have a path to accelerating procedure growth and increasing wallet share as we drive deeper penetration with our broadened product portfolio and continue to more comprehensively service our great surgeon customers' product and procedure needs. Combined with disciplined investment, these efforts position us to deliver sustained market share gains, improve profitability and long-term shareholder value. With that, now let me turn the call over to Mark to review our financial performance. Mark? Mark Hair: Thank you, John. Good morning, everyone. Revenue in the first quarter was $47.2 million, a decrease of 10% compared to the prior year. The decline was mainly driven by the shift in revenue mix towards lower-priced minimally invasive products and lower volume of bunion procedure kits sold. Gross margin was 79.3% in the first quarter of 2026 compared to 79.7% in the first quarter of 2025. Total operating expenses were $54.6 million in the first quarter of 2026 compared to total operating expenses of $57.5 million in the first quarter of 2025. First quarter net loss was $18 million or $0.28 per share compared to a net loss of $15.9 million or $0.25 per share in the first quarter of 2025. Adjusted EBITDA for the first quarter was a loss of $5.5 million compared to a loss of $3.8 million in the first quarter of 2025. Cash, cash equivalents and marketable securities totaled $51.9 million as of March 31, 2026. This represents an increase of approximately $3.5 million from the company's balance sheet of $48.4 million as of December 31, 2025, and compares to an increase of approximately $0.4 million in the first quarter of 2025. Turning to our outlook for full year 2026. We are reaffirming our full year guidance, which we raised in conjunction with the announcement of preliminary operating results on April 9, and expect full year 2026 revenue to be in the range of $202 million to $212 million, representing a decline of 5% to 0% compared to the full year 2025. We expect revenue declines to continue until our seasonally strongest fourth quarter. Fourth quarter revenue growth is expected to be largely supported by accelerating case volumes, the lapping of the mix shift dynamics as well as contributions from our planned 2026 product launches. In addition, we are reaffirming our expectation of a loss in adjusted EBITDA in the range of $4 million to $6 million for the full year 2026 as compared to a loss of $3.9 million in full year 2025. We also expect a reduction in cash usage of approximately 50% for full year 2026 as compared to full year 2025. Supported by a strong and flexible balance sheet, we believe we are well positioned to continue executing our strategic and growth initiatives for the foreseeable future. With that, I'll turn the call over to the operator to open the line for questions. Operator: [Operator Instructions] Our first question comes from Ryan Zimmerman with BTIG. Iseult McMahon: This is Izzy on for Ryan. So I just wanted to start on your ASP and mix shift. Mark, it sounded like you are expecting the ASP headwinds to lapse around the fourth quarter, but I was hoping you could speak to that a little bit more and what we can expect moving throughout the year? Mark Hair: This is Mark. Thanks for the question. As we began to talk about at the end of last year and we talked about on our last call, we're really pleased with the launch of our new products. We know that some of these products have lower ASPs and they've been readily adopted by a large portion of our surgeon base. John talked about how around 35% of our current customer base has already adopted some of these new products at these lower ASPs. So this is the dynamic that we talked about over the last couple of calls. We anticipate to continue to see that until we begin to lap or to have an anniversary of when we made these new products available, it's really in the third quarter of this year. So some of these dynamics, we fully anticipate to continue. This is the exact dynamics that we talked about. And so we feel like the strategy is working. We're getting these new products to our surgeons. They're utilizing them, and that's just going to have a temporary headwind in the first part of this year, but that will change in the back half of this year. Iseult McMahon: Appreciate it. And it looks like gross margins came in a little bit higher than Street expectations. So as you guys continue to launch these new products and see the benefits from the products that were launched late in 2025, how should we think about gross margins going forward? Mark Hair: Another great question. We are very focused on gross margins here. Our new products, we really have a goal to launch new products to have consistent gross margins with what we've had historically. Some of these margins do fluctuate from quarter-to-quarter. We benefit in the seasonally strong fourth quarter when we have higher volumes. And there are, of course, lots of pieces and components that impact gross margins overall. But we're pleased with what we did in Q1. They came in strong, a little bit better than what we had anticipated. So we view that as very positive. So we'll continue to launch new products to keep in line with this range of high 70% gross margins, and we believe that we can continue to do that going forward. Operator: Our next question comes from Ben Haynor with Lake Street Capital Markets. Benjamin Haynor: Great to see that so many of the folks have adopted these new solutions. I guess what are you seeing once they do? I mean, do they immediately kind of swing the pendulum to their ultimate adoption of the osteotomy solutions versus Lapiplasty? Do they swing too far? Do they work their way towards the ultimate mix? Or how has that tracked from what you've seen thus far? John Treace: Ben, it's John. Thanks for the question. We've seen, in general, strong adoption by our customer base with these new products once they get trained on them, do a couple of cases, they tend to be pretty sticky. And we're pleased with the way that's going there. And it's still early days, but as mentioned, we've got now 35% of our base Lapiplasty customers now using one of these 3 new solutions in their practice, and we're working on getting more of them using 2 and 3. Over time, we want them to be full portfolio of surgeons as we move through time. We've also seen, and it's early, but some adoption of Lapiplasty technologies with surgeons that came in initially to Treace through using one of those new 3 products. So too early to say what the materiality of that is going to be. We'll maybe comment on that as we get more experience later through the year, but it is good to see that dynamic as well. Mark Hair: Sorry, this is Mark. I think another important point to realize is that as we've offered these new product options, we don't necessarily believe that they're replacing our Lapiplasty procedures as well. We think it's going to be additive and allow them to have more options for the patient needs. So where that ultimately lands, what that mix ultimately is, it's still to be determined, but we don't necessarily believe, I think, in your question was, is it replacing Lapiplasty. We think it's providing additional options for the patient needs and for those surgeons to address whatever deformity that they see. Benjamin Haynor: I was looking at it. And then as you bring out more and more solutions in the portfolio and once the folks adopt the full portfolio of course, I mean, I guess what percentage or proportion of the foot and ankle cases that are done every year could the current and to be launched in the near future Treace products find their way into? I mean, is it 50%, 70%, 90%? What does that look like? John Treace: Yes. Thanks, Ben. John here. It's hard to say the exact percentage, but as we launch products like SuperBite and now we have the broad portfolio that includes MTP Fusion solutions as well as 3 different ways to treat a bunion, 4 different ways to treat a bunion, you're definitely getting into a large -- being able to cover a large percentage of the surgeons' workhorse foot and ankle cases, I would say. And the sales force is pretty excited about that. The addition of SuperBite, for instance, in the early innings here, they're displacing some competitors that used to sit in the room just to use that compression screw technology. And now they have their own. So I think it's going to be interesting to play out over time, and we do definitely appeal to a much broader base of the surgeons' overall caseload as we work through the year and get these products out. Benjamin Haynor: Okay. And on the SuperBite, how many SKUs are in that? How does that stack up versus competitive offerings on the screw side? John Treace: Yes, Ben, we tried to do this in a very capital-efficient and inventory efficient way. As we thought about launching a compression screw system, we didn't want to have high capital, high inventory burden. Traditionally, these systems are -- have a lot of SKUs, hundreds and hundreds, maybe 1,000. So we've been trying -- we've tried to design this and bring forth a system that, I don't have the exact number of SKUs, but it's probably in the range of 100 or so sellable items in our system, and that makes it very lean and very efficient and something we can manage very well and we can -- providing good volumes to the field so they can really make maximum impact as we get these out. Operator: Our next question comes from Rick Wise from Stifel. Frederick Wise: I wanted to dig a little more into the sales cadence outlook for this year, and with your patience, talk about the setup for '27. I mean, it seems like, John, the strategy clearly is visible. It seems to be working. We're in the early days of the strategy becoming increasingly visible. So sort of a 2-part high level, looking at the farthest kind of question. You beat the first quarter, you beat and raised. As you look at the rest of the year, how do we think about the outlook and your confidence? I know you want to stay conservative, but if you continue this first quarter pattern in the second and the third, hopefully, in the fourth quarter, is it going to be you're going to do a little better potentially because of penetration? Is it going to happen on -- is it the product side? Is it something to do with your execution? Just help us understand where more of the same could happen as we go through '26. And I'll ask Mark the tough question. Mark, I know it's hard to talk about '27 in precise terms, but my numbers -- my current numbers have you growing, I'm being cautious 5% next year. The consensus numbers are more like 9% or 10%. I mean, is 5% to 10% the right way to think about the potential for '27, if you execute well and all these products roll out and you see the trends we're seeing now? It sounds potentially very conservative. Help us think through all that. Sorry for the long-winded questions. John Treace: Okay. Thanks, Rick. I appreciate it. I'll take the first one, and then Mark can handle part 2 on future consensus. The way the year lines up is, like Mark said before, we've got some headwinds due to these ASP-related mix shift dynamics related to the 3 new bunion systems that we launched in Q3 last year. As we get to Q3, that headwind starts to abate. And additionally, in Q3, and increasingly Q4, we're going to benefit from the introduction of our 2026 launches, some of which carry favorable ASPs relative to the 3 products we launched last year, SpeedTMT as well as cases that will combine our SuperBite screws, SpeedXM plates and biologics, those are -- those get us into some higher dollar ASP midfoot and rear foot cases. And then we also have some new sales reps that are going to be ramping up in the back half of this year. So that's kind of the way we see the year and we're going to keep our heads down. We're pleased with our Q1. We're not satisfied. We got a lot of work to do, but we've got a lot of good things going on with this business as we build out a more robust and diversified portfolio with some new growth channels in it with these different product lines. Mark Hair: Rick, this is Mark. I'll just say John is right on there. We're going to look at this one quarter at a time. We're pleased with the results in Q1. They came in as expected, which is good for our progress during this year. And so I'll start there that it's one quarter at a time and we're going to focus on getting this right this year. With respect to next year, we have not given any formal guidance with respect to 2027, but I can tell you that we are expecting to return to revenue growth in the fourth quarter this year. So I think it's going to be a little bit early to talk about 2027. It's going to be -- next year will be impacted on what is our momentum as we're exiting this year. But I think the positive story is that although we did have a decline this quarter, and we may have some revenue declines in the short term here, we believe that we'll have increased momentum with case volumes as well as the top line revenue growth as we're exiting the year. So before we give formal guidance to next year, we want to better understand that momentum, but we do believe that we're going to be set up very well for next year as we exit -- as we fully anticipate or plan to exit this year with increased revenue growth. Frederick Wise: And just one more for me. Maybe, John, you could talk about just the general environment. We didn't hear from Stryker this quarter because of their cyber issues as clearly as we normally would. What's your sense of the market environment? Are consumers behaving as usual? Are doctors -- just is the environment an okay one or as usual or stable? How are you -- what are you seeing -- how are you thinking about that aspect for the rest of the year? John Treace: Yes, appreciate it, Rick. When we entered this year, we said that we expected the macro headwind type of dynamics, consumer sentiment related impacts on elective procedures to continue into this year. We didn't really see a reason things were going to be dramatically shifting. Q1 kind of played out within our expectations, really didn't see any surprises in patient flow and the surgeon activity beyond what we anticipated. We don't have independent data yet to tell us what the overall market trends were for bunions or foot and ankle elective in Q1. But again, it played out as we expected pretty much. So we're going to continue to focus on our strategies, getting these new products out in full supply, training more doctors and gaining new customers and accounts and work our way through quarter-to-quarter. Operator: Our next question comes from Lilia Lozada with JPMorgan. Lilia-Celine Lozada: The new MIS osteotomy products understandably get a lot of the attention, but I'm hoping you could share some color on how Lapiplasty has trended over the last few quarters. How meaningful of a contributor has the pull-through from Percuplasty, Nanoplasty been to reinvigorating growth in Lapiplasty? And do you see Lapiplasty Lightning as more of an incremental update? Or is it something that could have a material impact on ASP and volumes? John Treace: Lilia, thank you for the question. It's John. As we said on our last call, there's been patient and surgeon preference changes to more MIS options and even to more MTP Fusions on some bunion patients over time, MTPs where they might have some arthritis in the great toe joint. We've seen a great uptick in response to our MTP Fusion offering. It's doing very well out there, and that product does carry a higher average selling price than our -- the average price on our MIS products. So we like to see that. With respect to Lapidus, there continues to be strong demand for Lapiplasty, where Lapiplasty is indicated in the surgeon's algorithm at this point in time, and we have seen, as alluded to, what we believe to be some pull-through from surgeons that came in new to Treace through one of our 3 new bunion products adopting Lapiplasty. Now it's early on, and these numbers aren't large yet, but we'll be watching that through the year. And we do believe in the advancements of Lightning and SpeedTMT, more availability of IntelliGuide, these are tools that can help us appeal to more surgeons as we bring those into more force into the market late this year. Lilia-Celine Lozada: Great. And then just as a follow-up, could you talk a bit more about some of the competitive dynamics and your competitive positioning now that you're sort of going more head-to-head with the other ortho players in MIS osteotomy? So are you seeing adoption of these new products primarily from existing Lapiplasty accounts? Are you seeing a good amount of competitive switches? Any color you could share on how that competitive positioning has evolved over the last few quarters would be helpful. John Treace: Sure, Lilia. I think it's been -- initially, we probably had more uptake in our existing customer base. But as these products have gotten out in greater supply and the sales reps have become more familiar with them, we train more surgeons on them, more surgeons are using them, they're talking to their peer surgeons about these new MIS systems. Our instrumentation is fantastic. It really is. It's extremely helpful in allowing these surgeons to do a more reproducible, predictable MIS osteotomy procedure. So as we've gotten more into the market, over more time, we've definitely been seeing more competitive conversions. And our sales team's expertise, our training and the efficacy of these products is what's making it happen. So we're seeing a good uptake. We're seeing displacement of competitors, not only in the MIS systems, but with our SpeedMTP, too. And that's a big, important segment of the market. So we like what we're seeing across all fronts, both how they're being implemented within our existing Lapiplasty user base and the adoption we're getting from new surgeons and competitive conversions. Operator: And I'm not showing any further questions at this time. And as such, this does conclude today's presentation. We thank you for your participation. You may now disconnect, and have a wonderful day. Before you buy stock in Treace Medical Concepts, 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 Treace Medical Concepts wasn’t one of them. 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Image source: The Motley Fool. Thursday, February 26, 2026 at 4:30 p.m. ET Chief Executive Officer — John T. Treace Chief Financial Officer — Mark L. Hair John Treace, Chief Executive Officer; and Mark Hair, Chief Financial Officer. John and Mark will discuss our fourth quarter financial results and 2026 outlook. We will then host a question-and-answer session following our prepared remarks. Our press release can be found in the Investor Relations section of our website at investors.treace.com. This call is being recorded and will be archived in the Investors section of our website. Before we begin, we would like to remind you that it is our intent that all forward-looking statements made during today's call will be protected under the Private Securities Litigation Reform Act of 1995. Any statements that relate to expectations or predictions of future events and market trends as well as our estimated results or performance are forward-looking statements. All forward-looking statements are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. All forward-looking statements are based upon currently available information, and Treace Medical assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these statements. Please refer to our SEC filings included on our Form 10-K for 2025 filed before market opened today, February 27, and can be found in the Investor Relations section of our website at investors.treace.com for a detailed presentation of risks. With that, I will now turn the call over to John. John Treace: Thank you, Trip. Good morning, everyone, and thank you for joining us on our fourth quarter 2025 earnings conference call. During 2025, Treace Medical entered a transformational phase, building upon our leadership as recognized bunion experts and evolving from a Lapiplasty-focused company into a comprehensive bunion solutions company. With the recent commercialization of multiple new bunion procedure innovations, we are now positioned to address virtually 100% of surgeons' current technique preferences for all types of bunion correction, offering 5 best-in-class instrumented systems spanning all 4 categories of bunion deformities. We've been highly focused on accelerating our bunion procedure volume growth while also broadening our technology offerings to increase wallet share and expand our serviceable TAM. Our elevated case volume growth in the back half of 2025 reinforces our confidence that we have the right strategies in place to continue to expand our market penetration and restore top line revenue growth later in 2026 and into the future. We also drove steady improvement in adjusted EBITDA and significantly reduced our cash burn for 2025. Before diving deeper into our expectations for 2026, I want to note that dynamics discussed on our last call that pressured 2025, including case volume growth, offset by headwinds related to broader economic conditions and softer consumer sentiment as well as a product mix shift within our expanded portfolio are still present to begin the year. Given these market conditions, we're initiating our outlook for full year 2026 revenue to be in the range of $200 million to $212 million, representing a decline of 6% to 0% compared to full year 2025. We expect revenue declines to continue until our seasonally strongest fourth quarter. We expect fourth quarter revenue growth will largely be driven by accelerating case volumes, the lapping of the mix shift dynamics as well as the contribution from our planned 2026 product launches. We remain focused on continued improvements in profitability and reducing cash burn in 2026. As a reminder of our progress to date, in 2024, we used $50.5 million in cash and reported an $11 million loss in adjusted EBITDA. In 2025, we used $27.3 million of cash, a 46% reduction versus 2024, and we reduced our adjusted EBITDA loss to $3.9 million in 2025, a 64% improvement over the prior year. We took several actions in 2025 to reduce our operating expenses and cash usage. Many of these changes will continue to benefit us throughout 2026. We, therefore, anticipate that we will again reduce our cash burn by approximately 50% in 2026 compared to 2025, and we're not done. We will continue to identify additional opportunities to drive our top line growth and leverage our P&L in 2026. Now I want to focus on our strategies, the progress we made in 2025 and where we expect to deliver in 2026. To start, let me tell you about our strategies to improve our top line performance in 2026 and beyond. First, we will focus on leveraging our large existing customer base to drive adoption of our new 2025 bunion product launches. Second, we'll continue to build upon our leadership position with Lapiplasty technology, adding new technologies that can attract new surgeons. And third, we will expand our product offerings to grow wallet share and tap into new TAM-expanding procedural adjacencies. To start, I want to give you an update on the new bunion technologies we launched during 2025, their strategic importance and the reception they're getting in the marketplace. We believe our 3 new bunion systems effectively double the accessible market that we have today with Lapiplasty. So effectively driving these deep into the marketplace is a very high priority for us. First, our differentiated Nanoplasty and Percuplasty 3D MIS systems expand our reach into the high-volume osteotomy segment, which we estimate represents approximately 70% of the 450,000 annual bunion procedures performed in the U.S. We estimate that only 10% to 15% of metatarsal osteotomies are being performed using MIS approaches today. And we believe this is largely due to the steep learning curves, high variability of outcomes and lack of attention to correcting the third frontal plane component of the deformity, the failure of which to do so has been associated with an increased risk of bunion recurrence. Our new 3D MIS bunion correction systems offer patients procedures that can result in less pain and fast recovery times with minimal visible scars. Importantly, these are procedures that are quick for surgeons to learn and are highly instrumented to enable a controlled correction of all 3 planes of the deformity to minimize risk of recurrence. We believe this expands the appeal of our 3D MIS osteotomy procedures to both surgeons and patients today and could encourage a much larger portion of the 4.4 million U.S. bunion sufferers to seek surgical treatment over time. Next, our SpeedMTP system, which is designed to serve roughly 20% of bunion patients who have arthritic grade toe or MTP joints as well as patients who suffer from isolated MTP joint arthritis. This large patient population makes MTP fusion one of the most common procedures performed by foot and ankle surgeons, making it a strategically important area for Treace to target with better solutions and continue to innovate. With our core Lapiplasty system, we believe we've captured 25% on average of our 3,300 customers' total bunion-related procedure volume. And these 3 new systems are dialed in to target the remaining 75%, and we are laser-focused on penetrating that untapped opportunity. And our strategy is working. Just over 2 quarters into the full launch of these new systems, we're encouraged by the rapid adoption and resulting acceleration we're seeing in our overall bunion-related procedure volumes. As of Q4, over 25% of our surgeon base has already incorporated 1 or more of these 3 new bunion systems into their practice, and our Q4 procedure volume growth increased over the mid-single-digit rates we achieved and reported on in Q3. Next, in addition to our new products, advancing our leadership in Lapiplasty technology and expanding its user base remains at the forefront of our strategy. Lapidus Fusion represents approximately 30% of the estimated 450,000 U.S. annual bunion procedures and is the largest dollar segment of the market where Treace is a recognized category leader. As MIS approaches are gaining in popularity among surgeons and patients, we continue to remain focused on advancing our Lapiplasty platform, making the procedure simpler, faster and minimally invasive as demonstrated by our Micro-Lapiplasty platform, which was launched in 2024. In 2026, we plan to commercialize our next-generation Lapiplasty platform known as Lapiplasty Lightning. Lightning combines next-generation 3D correction instrumentation and SpeedPlate TMT implants, which are built upon our proprietary SpeedPlate hybrid fixation technology. Speed TMT is a high-performance implant designed to appeal to an incremental surgeon audience, those that prefer a single plate fixation construct versus our traditional 2-plate or biplanar approach. Lightning Instrumentation is designed to reduce procedural steps, improve efficiency and provide surgeons with greater accuracy and control of their 3D correction. We expect full availability of our Lightning instrumentation and our Speed TMT implants later in the year. Another way we're appealing to more surgeons with Lapiplasty is by advancing the shift towards personalized surgery, leveraging our IntelliGuide PSI platform. IntelliGuide is industry's first and only preoperative planning and patient-specific cut guide system for correcting bunion and mid-foot deformities. IntelliGuide offers surgeons improved efficiency and precision and is particularly helpful in complex and revisional cases. We believe the combination of Lightning, Speed TMT and IntelliGuide position us well to extend our leadership position and attract more surgeon users to our Lapiplasty platform in 2026 and beyond. Now turning to our third strategy, expanding our offerings to more broadly serve our growing customer base. In 2025, we expanded our SpeedPlate and Sterile instrument portfolios with multiple new offerings. We also entered the biologics market with our CortIFuse flowable cortical fiber graft as well as our line of procedure-specific allograft wedges. These new biologic offerings allow our sales force to more comprehensively service our surgeons' needs in their cases. In 2026, we plan to launch additional offerings to grow our customer wallet share and tap into incremental procedure adjacencies. In the back half of this year, we plan to launch 2 new important products that expand our TAM by an estimated $300 million. First, our SuperBite variable pitch compression screw system. This is a very important addition to our portfolio as it equips our sales force for the first time with the most common form of fixation used in foot and ankle surgery. The SuperBite system features advanced design attributes, making it ideal from both minimally invasive and conventional surgical approaches. Next, we will make our first entry into the mid-foot, hindfoot segment of the market with the launch of our new Speed XM Fusion system. Speed XM leverages our SpeedPlate fixation technology, bringing the benefits of dynamic compression and enhanced stability for fusion of the larger bones of the mid- and hindfoot as well as for flatfoot reconstructive procedures. Speed XM is highly complementary with our SuperBite screw system as the 2 technologies are often used in concert along with biologics to stabilize and fuse these larger bones, thus giving Treace great incremental access to high ASP adjacent procedures that we do not serve today. And of course, with all our current and new product offerings, we continue to provide best-in-class education through our BunionMasters hands-on training programs. These events are designed to support surgeons in confidently integrating our procedures and technologies into their practices. And following these trainings to further enable successful patient outcomes for our surgeons, we provide additional initial case support from our fleet of dedicated clinical specialists and ongoing support from our bunion-focused direct sales team, a team that we plan to expand in 2026 with the addition of more experienced foot and ankle sales professionals. Our confidence in the future is grounded in the success we've achieved in the past as well as the early indications we're seeing, which reinforces our confidence that we have the right strategies in place moving forward. We've expanded our active surgeon base from nearly 1,300 users in 2020 to over 3,300 users in 2025, and these surgeons are using more of our products as they adopt our growing portfolio with best-in-class solutions. Fourth quarter procedure volume growth increased over the mid-single-digit rates achieved in Q3, reflecting the strength and effectiveness of our comprehensive bunion portfolio and strategy. As we look ahead, we believe we're well positioned to accelerate our procedure volume growth rates while also growing our customer wallet share and expanding our TAM as we broaden our footprint in the foot and ankle market. We expect these initiatives, combined with disciplined investments, will continue to drive market share gains, improve profitability and shareholder value. With that, let me now turn the call over to Mark to review our financial performance. Mark? Mark Hair: Thank you, John. Good morning, everyone. Revenue in the fourth quarter was $62.5 million, a decrease of 9% compared to the prior year period. The decline was mainly driven by the shift in revenue mix towards lower-priced products. Gross margin was 80.6% in the fourth quarter of 2025 compared to 80.7% in the fourth quarter of 2024. Total operating expenses were $56.3 million in the fourth quarter of 2025 compared to total operating expenses of $55.7 million in the fourth quarter of 2024. The increase reflects restructuring charges and increased litigation expenses in the quarter compared to prior year. Fourth quarter net loss was $9.4 million or $0.15 per share compared to a net loss of $0.5 million or $0.01 per share in the fourth quarter of 2024. Adjusted EBITDA for the fourth quarter was $6.2 million compared to $11.1 million in the fourth quarter of 2024. Full year 2025 adjusted EBITDA loss was $3.9 million compared to full year 2024 adjusted EBITDA loss of $11.0 million, a 64% improvement over the prior year. Cash, cash equivalents and marketable securities totaled $48.4 million as of December 31, 2025. The company's new credit facility provides an additional $115 million of liquidity, subject to certain conditions. The company used $27.3 million of cash during the full year 2025, a decrease of 46% compared to $50.5 million in 2024. Before concluding, let me turn to our outlook for full year 2026. As John mentioned, we're initiating our full year guidance. We expect full year 2026 revenue to be in the range of $200 million to $212 million, representing a decline of 6% to 0% compared to the full year 2025. We expect revenue declines to continue until our seasonally strongest fourth quarter. Fourth quarter revenue growth will largely be driven by accelerating case volumes, the lapping of the mix shift dynamics as well as contribution from our planned 2026 product launches. Looking closer at the first quarter, similar to prior years, following our seasonally strongest quarter, we anticipate Q1 revenue will step down approximately 27% compared to Q4 2025. Then we expect year-over-year growth rates to improve each quarter thereafter. In addition, the company expects a loss in adjusted EBITDA in the range of $4 million to $6 million for the full year 2026 as compared to a loss of $3.9 million in full year 2025. We also expect a reduction in cash usage of approximately 50% for full year 2026 as compared to full year 2025. Supported by a strong and flexible balance sheet, we believe we are well positioned to continue executing our strategic and growth initiatives for the foreseeable future. With that, I'll turn the call over to the operator to open the line for questions. Operator: [Operator Instructions] our first question comes from Danielle Antalffy with UBS. Danielle Antalffy: We've heard from a number of players over the course of 2025 that the foot and ankle market was seemingly unusually soft. And I followed you guys for a long time. This has been a relatively high-growth market. John, I'd love to hear your thoughts on what's going on in this market. And as far as your guidance goes, the overall market itself, what's reflected from a growth perspective? Do we return back to normal, continued softness here? Anything you can say to that? John Treace: Sure. Danielle, thank you for the question. As we've indicated on past calls, during 2025, our surgeons were reporting deferrals of cases. We believe that made it a softer year and potentially a declining year in overall bunion surgical volume. As you noted, other companies have mentioned the foot and ankle market being soft, particularly in elective foot and ankle procedures in 2025 or even that may have contracted a little bit. Given we've got an increase in our Q4 case volumes versus Q3, I think it really does demonstrate that we're taking share with this new comprehensive bunion portfolio and strategy even in a softer market. When it comes to our outlook for 2026, we're increased -- we're expecting that increase in case volume that's going to be offset by product ASP mix-related headwinds for the first half of the year. That will begin to abate in Q3 as we start to lap the introduction of these lower ASP, higher volume driving 2025 product introductions. Additionally, in Q3, we'll increasingly, as we go into Q4, benefit from the introduction of the new 2026 product launches, these carry a little higher case ASPs, such as our Lapiplasty Lightning and Speed TMT and the combination effect that we get from our Speed XM mid-foot plating and SuperBite screws. So we also have some new sales reps that are going to be ramping up in the back half of the year, and we have some easier comps there. So we feel good about the cadence. We feel good about the new products we're introducing and the impact they're going to have. As far as the market dynamics go, we're kind of contemplating a similar dynamic to what we experienced in 2025. Danielle Antalffy: Okay. Understood. That's helpful. And I'm just curious, as far as the scaling of the biologics portfolio that you talked about, how that will impact operating margins? I know you guys are committed to EBITDA positive, but just curious about any nuances there. Mark Hair: Danielle, this is Mark. Thanks for the question. Yes, we're excited that we continue to expand our product offerings. And so that's just going to be another product in our bag that our sales reps can now provide to surgeons who are looking for those biologic solutions. And so we've got good margins on those. We don't think that it's negatively going to impact us at all, but to provide additional revenue going forward into 2026 as we have this new offering. So I don't think there's anything negative about it at all. It's all upside for us as we have this broader portfolio. Operator: Our next question comes from Ben Haynor with Lake Street Capital Markets. Benjamin Haynor: First off for me on the products expanding the TAM, can you maybe share a little bit more about those, how long they've been in development? Any experience of the folks that have had their hands on them yet? Any additional color there would be helpful. John Treace: Sure, Ben. Thanks for the question. Yes, the SuperBite screws, these have been in development. Typically, our product development time lines are 18 months or so. We've been working with an elite team of minimally invasive surgeons on these as well as our traditional SAB development team. We put a lot of work into it. They're very refined. They have some really nice features that make them very high performance. The ability to put this in our sales reps bag really adds breadth to their line, the ability to control a greater portion of the overall surgical case, and we're excited about this. It's the first time they're going to have one of the most commonly used forms of fixation in the foot and ankle. So it's going to be very synergistic with a lot of the current products they have, additive to the case ASPs. The second product we talked about was the Speed XM. That's our mid-foot plating system. Again, it's been in development for quite some time, very refined, a lot of cadaveric testing. We've had a lot of surgeons put their hands on this, and we're looking forward to rolling it out mid next year. This is for fusing larger bones that are further back in the foot like the talonavicular, the calcaneocuboid, naviculocuneiform, flatfoot reconstruction, triple arthrodesis. These are larger bones more in the back of the foot. These are procedure adjacencies that are often related to the bunion and convenient call points for our sales force. So we're excited that they'll have the ability now to tap into these new incremental high ASP procedures with these 2 complementary technologies. Benjamin Haynor: And you said mid this year or mid next year? John Treace: Coming mid this year. Benjamin Haynor: Okay. Maybe I misheard you. Sorry. And then secondly for me, on the quarter of your surgeons that have tried the new osteotomy solutions. What are the ones that they pick up first? How does it kind of fit into their algorithm? Any additional color would be helpful. John Treace: Sure, sure. And there's 2 platforms there, Ben. We've got the MTP fusion system, which is getting a lot of traction. This is the first dedicated offering that Treace Medical has offered into that large space, that large subsegment of bunion patients that the bunion patient comes in, they have a painful bump, but they actually have arthritis in the big toe joint. That's roughly 20% of the patients, that surgeons see for a bunion. Then there's an entirely other class of patient that fits for that Speed MTP, that MTP fusion that doesn't have a bunion, but has big toe arthritis isolated. So it's one of the most common procedures performed by our surgeons. And now we're playing in that space. The price point is at a premium to the MIS osteotomy products we offer. So we like that, and we're seeing a really good pickup there. Regarding the MIS products, we have 2. And the way we've been hitting the marketplace and sort of segmenting the user base, if surgeons have not tried minimally invasive bunion surgery before, Nanoplasty is a more welcoming and easy step for them because it does not require them to learn how to use a rotary powered cutting burr. They can use their conventional saw. We have excellently designed instrumentation that allows them to control the whole procedure, correct all 3 cardinal planes of the bunion deformity and do it in a comfortable and reproducible fashion. So Nanoplasty serves that customer group predominantly that hasn't engaged in minimally invasive osteotomy surgery. The other group are the surgeons that have engaged in minimally invasive osteotomy surgery and they have some level of proficiency, and that's our Percuplasty. So we go after them with our Percuplasty system. We have superior screw designs that don't require drilling, so it makes it faster to insert. And our jig system has just received very high acclaim from everybody we've put it into their hands. That's allowing them the more controlled instrumented procedure, the ability to reproducibly correct all 3 planes of the bunion and do it in a fast and efficient manner. So you add these technologies to our entire portfolio and what surgeons are seeing is a comprehensive suite of offerings that are best-in-class, whether they need to fuse an MTP joint, do a Lapidus or Lapiplasty or do a minimally invasive osteotomy procedure for their patients. So we're really well equipped. Sales force is in a great position now with all these products on all these fronts, and we're driving it forward and we're driving our case volumes. Operator: Our next question comes from Ryan Zimmerman with BTIG. Ryan Zimmerman: Can you hear me okay? John Treace: We hear you loud and clear, Ryan. Ryan Zimmerman: Great. Maybe with -- starting with the guide, both for Mark and John. When you think about what's embedded in the high end and the low end of the guide, what is the toggle? Or what are the variables that you've kind of embedded in the guidance that get you to the low end, that get you to the high end? How much of that is market dynamics versus maybe product mix shift? If you can kind of deconstruct that a little bit, I think that would be appreciated. Mark Hair: Yes, Ryan, this is Mark. I'll take a first shot at that. We did offer a range this year, and it partly goes to some of these dynamics that John talked about earlier that we saw exiting 2025 that there were some changes in patient dynamics and some -- what we were referring to previously as some macroeconomic headwinds. So there is some uncertainty as we come into this year. So we wanted to make sure that, that range comprehends some of that market uncertainty. So that would probably be towards the lower end of that range to the extent that there isn't some improvement or that some of these dynamics don't improve this year versus last year. So -- or they worsen. I think on the upside is where we continue to have incremental uptake of our new products. Those that we launched last year again, we've talked about case volume increases in both Q3 and Q4. We're anticipating case volume increases throughout 2026 as well year-over-year. So to the extent more surgeons are adopting these new cases -- these new procedures and to the extent there's greater uptake on our new product launches that are coming out. John just talked about SuperBite as well as Speed XM. So these are new product launches that are coming out this year. And to the extent there's greater uptake on those, then there's opportunities to go to the high end of the range. So right now, we feel comfortable at the midpoint of the range. There are some variables in the marketplace and with our product offering. And so that's where we feel comfortable for now. Ryan Zimmerman: Yes. Okay. That's very helpful, Mark. And John, you've added a lot of products over, say, the last 18, 24 months, if you will. Historically, the sales force was a Lapiplasty focused sales force, right? And it was kind of like a tunnel vision. It was that segment of the market. How do you balance the focus of the sales force? And you're adding a lot of these products. There's pushes and pulls on pricing dynamics with those products as a result of that. I'm just curious kind of, is there a risk of dilution in terms of focus in the sales force? And just your general thoughts on kind of how you balance those dynamics with all the products you're adding? John Treace: Yes. Thanks, Ryan. Really insightful question. We've done a lot of work with our sales team for the past over a year now, getting them ready for this, getting them trained. These technologies aren't technologies necessarily they're having to push or force their products and technologies that our customer base is desiring and kind of demanding. So the way we look at it is we keep them focused on that bunion sweet spot. And then as the surgeons have adjacency procedures that they want to serve with our product line, we have them to serve them. And that's why the SuperBite screw line is so important. Speed XM is so important and the next-generation technologies we're bringing out with Lapiplasty are going to be very important as well. But we find that these are the types of products that our sales force's customers are wanting from Treace Medical. Speed XM is a perfect example. They love the SpeedPlate technology, and they're asking us, can you develop this for these other larger bones? And I could use them with your new screws that are coming out. So we're listening to our customers very closely, and we're trying to develop our product line in concert with kind of the path at least resistance for the sales force. Operator: Our next question comes from Rick Wise with Stifel. Frederick Wise: John, you highlighted -- I think your words were something like you can now address 100% of the bunion opportunities or bunion-related opportunities with the broadened pipeline. I'm just curious how you're seeing with what you already have and what you're expecting competitively. How does this -- how is your broader product line, how does the expanding sales force, this repositioning of the company, how is it affecting competitive dynamics? And is this really going to -- I'm not asking it skeptically. I mean, it's got to shake things up a little bit. John Treace: Rick, yes, great question. It's a competitive marketplace, and a lot of people are trying to play in it, a lot of large competitors, small competitors. We just returned from our largest surgeon conference of the year, the ACFAS Conference in Las Vegas, huge attendance. Over 2,000 of our most common foot and ankle surgeons participating there. We had a great booth. All these technologies were on display. We had very high traffic at our booth. I can tell you our cadaver training labs that we held at the meeting were oversubscribed and attended beyond what we expected. So I think there's a lot of appreciation for what Treace Medical brings in terms of being bunion experts and being able to help surgeons navigate through the changing landscape of patient interest and what type of procedures they're going to want to be offering in their practice. So knowing that Treace Medical has this full suite, 5 different categories of best-in-class solutions that can comprehensively serve those surgeons -- patient bunion needs across the spectrum. I think that's a very comfortable position for surgeons to be with Treace Medical. And our reps know the procedures inside and out. We hold their hands. We give the surgeons excellent training. We reinforce the uptake on the products in the OR with our expert clinical specialists to make sure those first cases go smooth and they get great patient outcomes. And then they're taken care of by very focused bunion direct sales force. So again, a lot of enthusiasm for these products, and we think it's going to continue to build. Frederick Wise: And Mark, maybe you could expand on your cash flow outlook comments. Obviously, you've done a great job reducing your rate of cash burn, and you seem to have a lot of optimism you can make a significant dent in cash burn in the year ahead. Better sales will help mix, I'm guessing. But talk us through the initiatives that you're contemplating incrementally for 2026 and why we shouldn't be concerned that this is going to limit the company's ability to -- on the marketing front or sales expansion front to get the sales growth side of the job done. Mark Hair: Rick, we've, for the last several quarters now, talked about our laser focus on profitability improvement and cash management. And -- so we took a lot of steps last year to begin to improve our overall cost structure and our P&L. And a lot of those changes that we made last year will benefit us throughout the full year 2026. So some of those cost reductions, we reported some restructuring charges last year. So that's -- we'll be able to annualize those benefits throughout 2026. We've talked a little bit about a couple of other things that were unique to 2025. We -- as we've launched all of these incremental bunion systems and adjacent products, we really hit a high watermark with regards to our medical education, and we really invested in training all of our existing surgeons, and we reached out and did a lot of additional training to surgeons that are -- that had not been Treace customers. So although we will very much remain focused on medical education and training surgeons, we won't have the same level in 2026 that we did in 2025. So that's going to naturally come down a little bit. We've also talked about the -- some of the natural leverage that comes in our sales force. We've hired a lot of sales reps. And as they come off some of their fixed salaries, there's some natural leverage in the sales organization as well. The other thing is we've talked -- in the last couple of calls, we've talked a little bit about our DTC efforts and activities and investments. And we are not investing as much as we had historically. And one of the main reasons is really what we were doing in earlier days was building brand recognition and brand awareness for both patients and surgeons. But now we've got over -- what we estimate 1/3 of the U.S. surgeons using Treace products last year. So we've got this huge large base of surgeon customers, and so we can leverage down some of that DTC investment that we don't believe will impact our top line growth. The last thing that I'll mention with respect to cash management or cash usage is last year with the introduction of several new bunion systems, we had incremental and higher CapEx or capital expenditures for our instrumentation trays that we own and we depreciate, but we make them available to our sales reps and to the surgeons who perform these new cases. So that was at a higher level last year. And we don't need to have the same level of capital investment in 2026. So not only is the OpEx going to come down, and you'll see some nice leverage there, but even on the CapEx as well. So the combination of all those things is what gives us confidence that we can reduce our cash burn by 50%, which is significant this year on top of the significant reductions that we just experienced last year. Operator: Our next question comes from Richard Newitter with Truist Securities. Richard Newitter: I have 2 questions. Maybe the first one, just a little bigger picture. I appreciate that you see mid-single-digit case volume growth. There's a lot of cross currents with mix shift. And I doubt those are going to go away because you're going to continue to have to evolve the portfolio and the marketplace is going to continue to be increasingly competitive. So the bigger picture question against that backdrop is what's the end goal here? Or how do you see your kind of sustainable longer-term normalized growth rate when you layer in some sense of normalcy on the bigger bag, a more productive sales force with that bigger bag? And is this a mid-single-digit grower sustainably longer term, just given where all the macro headwinds are maybe get some share gains that offset? Is this a high single-digit sustainable grower now? Just trying to get a sense for kind of where you're headed realistically longer term? And then I have a follow-up. Mark Hair: Yes, Rich, this is Mark. Let me begin with that, and John may have some additional color. So we are broadening the portfolio. Some of these items that we've talked about have lower ASPs and yet some of these new products and offerings that we're providing really have strong ASPs as well. Maybe a slight step down to Lapiplasty, but these are strong ASPs, and we'll continue to broaden our portfolio, not only in the bunion space, but the adjacencies that John talked about. So there's going to be some of that dynamic that overall, the ASPs or the revenue per case may come down from where we've been historically. As we think about the foot and ankle market, some of the questions already today, and we've talked about it a little bit, we believe that there were some macro trends in 2025 that may be were different from what we've seen historically. Historically, we'd say that the foot and ankle market is somewhere in the mid-single digits and growth rate year-over-year. That's what we've seen historically. And we believe that with our focus exclusively on foot and ankle and with a primary focus on the bunion that we can and should do at least what the market does and more. And that's because of our product profile, our direct channel sales force that can drive these products, and it's our focus. So we believe that we're uniquely positioned in the marketplace to do what the market is doing broadly and then some. So that's what we would anticipate going forward. Richard Newitter: Okay. And then I'm just curious relative to your original expectations when you made the strategic pivot, if you will, what felt like a strategic pivot to us to the MIS osteotomy versus Lapiplasty. Macro developments aside, how is that strategy playing out relative to kind of competitive conversions or trialing that maybe are coming back? Is everything progressing according to plan, notwithstanding some of the mix and macro kind of externalities? John Treace: Rich, John here. I would say, yes, very positive reception to these new technologies. What we're known for is developing really elegant instrumentation that takes challenging procedures and makes them very straightforward for surgeons. And these minimally invasive ways of doing the bunion, they're hard and surgeons need help, and we're giving them the tools to be able to get trained and put these into their practice quickly. We already had 25% and just 2 quarters into launching these new technologies, 25% of our 3,300 customers have already used one or more of these new technologies, have incorporated them into their practice. And we believe that's going to continue to build throughout the year, larger percentage of our overall surgeon base using these new technologies. And on average, those surgeons embracing more of those 3 new bunion systems as we progress throughout the year. That's what we're laser-focused on, and we're seeing a very positive reception, couldn't have been highlighted more than the reaction we just saw at our largest annual meeting of surgeons where we had very high turnout to get hands-on with these products in the lab, learn from our top faculty how to employ them into their practice, and we're looking forward to picking up a lot of new users as they return home. So I think everything is going as planned. Our MTP Fusion product is tapping into a market we've never played in before, and we're becoming a pretty quickly here, a very large share player in that space. And I think it speaks to the power of our model and our strategy and the ability of our sales team to execute. Operator: Our next question comes from Lilly Lozada with JPMorgan. Lilia-Celine Lozada: I'm hoping we can go back to some of the assumptions underpinning the guide. It sounds like you have to get past these Lapiplasty and mix headwinds and have strong uptake in MIS osteotomy to get back to growth in the fourth quarter. So to what extent does a rebound in the fourth quarter and the guidance for the year rest on meaningful share capture in MIS osteotomy. I appreciate you don't provide specific guidance by product, but any color on what the guide assumes in terms of how successful MIS osteotomy is and how Lapiplasty volumes are trending relatively would be helpful. John Treace: Lilly, it's John. Thanks for the question. I'll take a shot at this, and Mark can maybe chime in as well. We have some assumptions for -- that are built into our guide, both low and high end on uptake on our MIS osteotomy platform, our MTP fusion platform, how Lapiplasty and the new Lapiplasty products such as Speed TMT are going to perform. And then, of course, the new products we're bringing out starting in the middle of the year, the SuperBite screws and Speed XM. So all of those are built in. We have assumptions for them. We believe they're reasonable and achievable, and we're going to progress through the year, and we're trying to be prudent. And to the degree we can do better, we'll do better. But we're sticking to the plan for now and executing on it. Lilia-Celine Lozada: Great. And then just as a follow-up, can you talk about how the rollout of these new products affects how we should be thinking about your strategy penetrating the market deep versus wide. It sounds like there's a cohort of docs that maybe just never gravitated towards Lapiplasty and these new products give you something to offer them. So should we think about new surgeon adds trending higher than in years past? And is that more of a focus now than before? John Treace: Sure. Yes, some of them are -- some of these products are obviously built to bring on new surgeons that have not been users of Lapiplasty in the past. The Lightning instrumentation is going to be new and novel and has a lot of appeal to it. We just had a training on that, an alpha kind of preview training at our ACFAS Conference, very, very great reception from the surgeons that saw there. And the Speed TMT implant, that appeals to a very large surgeon audience that we have not appealed to before with Lapiplasty. Because this group of surgeons like to use one, fixation plate versus two, which has been our traditional. So we think we can appeal to new users there. And I'm sorry, maybe I lost the other part of your question, Lilly, if you don't mind reminding me or Mark can pick it up. Mark Hair: And maybe, Lilly, I'll jump in a little bit. This is Mark. I think our primary strategy has been that we -- to first build a very large customer surgeon base, and we're really proud of the work that we've done. It's taken a number of years, and we've really made great strides in increasing this customer surgeon base over the last 3 or 4 years. Now that we've got this large surgeon base and what John talked about earlier is that we've really only gotten maybe 1/4, 25% of their cases because they're doing other types of cases, we just haven't had an offering. So I think the first opportunity -- strategic opportunity is to add these new products to our existing surgeon base. That's strategy and focus number one. We know that there's many more bunion procedures that we have not been getting historically, and that's the biggest opportunity for us right now. With that said, and John is exactly right, we strongly believe that in addition to that focus on our large surgeon base, there are other surgeons that have just not really spoken to or become Treace customers and it could because of their preferences. In -- MIS is one example. We just haven't been in the MIS osteotomy space, and now we can play there. So it gives us an opportunity to provide those offerings to our large surgeon base and also reach outside of our customer base to bring incremental surgeons. But I don't think this year that we're looking to expand in dramatic form outside of our current surgeon base. We will add new surgeons this year. We've already done so and we'll continue to do so. But I think the bigger opportunity right now is to drive deeper into our existing 3,300-plus customer surgeon base. Operator: Thank you. This concludes the conference. Thank you for your participation. You may now disconnect. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Treace Medical (TMCI) Q4 2025 Earnings Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: $47.2 million in Q1 2026, a decrease of 10% compared to the prior year. Gross Margin: 79.3% in Q1 2026, compared to 79.7% in Q1 2025. Operating Expenses: $54.6 million in Q1 2026, down from $57.5 million in Q1 2025. Net Loss: $18 million or $0.28 per share in Q1 2026, compared to $15.9 million or $0.25 per share in Q1 2025. Adjusted EBITDA: Loss of $5.5 million in Q1 2026, compared to a loss of $3.8 million in Q1 2025. Cash and Equivalents: $51.9 million as of March 31, 2026, an increase of $3.5 million from December 31, 2025. Full-Year Revenue Guidance: $202 million to $212 million for 2026, representing a decline of 5% to 0% compared to 2025. Full-Year Adjusted EBITDA Guidance: Expected loss of $4 million to $6 million for 2026. Cash Usage Reduction: Expected reduction of approximately 50% for full year 2026 compared to 2025. Warning! GuruFocus has detected 5 Warning Signs with TMCI. Is TMCI fairly valued? Test your thesis with our free DCF calculator. Release Date: May 08, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Treace Medical Concepts Inc (NASDAQ:TMCI) has expanded its portfolio with multiple new procedure innovations, positioning the company to address a broad spectrum of surgeon and patient preferences across all bunion classes. The company has reported sustained mid-single-digit case volume momentum, reinforcing confidence in its strategy to expand market penetration and improve top-line growth. Approximately 35% of the Lapiplasty surgeon user base has incorporated at least one of the three new bunion systems into their practice, indicating strong adoption of new products. Treace Medical Concepts Inc (NASDAQ:TMCI) is on track to commercialize its next-generation Lapiplasty platform, Lapiplasty Lightning, which offers enhanced precision and control. The company has expanded its offerings with new SpeedPlate implants, sterile instruments, and its first biologics offerings, enabling the sales force to support surgeons' needs comprehensively. Treace Medical Concepts Inc (NASDAQ:TMCI) reported a revenue decline of approximately 10% in Q1 2026, primarily due to a shift in revenue mix towards lower-priced, minimally invasive products. The company experienced a net loss of $18 million or $0.28 per share in the first quarter, compared to a net loss of $15.9 million or $0.25 per share in the first quarter of 2025. Adjusted EBITDA for the first quarter was a loss of $5.5 million, compared to a loss of $3.8 million in the first quarter of 2025. Revenue declines are expected to continue until the seasonally strongest fourth quarter, with full-year 2026 revenue projected to decline by 5% to 0% compared to 2025. The company faces ongoing macro pressures on procedure demand and portfolio mix shifts, which impacted performance in 2025 and continue to be present. Q: Can you elaborate on the ASP headwinds and when they are expected to lapse? A: Mark Hair, CFO, explained that the ASP headwinds are due to the adoption of new products with lower ASPs. These dynamics are expected to continue until the third quarter of this year, after which they should begin to improve as the company laps the introduction of these new products. Q: How should we think about gross margins going forward with the launch of new products? A: Mark Hair, CFO, stated that the company aims to maintain consistent gross margins with historical levels, despite fluctuations. They are focused on launching new products that align with their high 70% gross margin range. Q: What is the adoption trend of new solutions compared to Lapiplasty? A: John Treace, CEO, noted strong adoption of new products by their customer base. About 35% of Lapiplasty customers are using at least one of the new solutions. The company aims for surgeons to adopt the full portfolio over time. Q: What percentage of foot and ankle cases could Treace products potentially cover? A: John Treace, CEO, mentioned that with the broad portfolio, including SuperBite and MTP fusion solutions, Treace products could cover a large percentage of surgeons' foot and ankle cases, appealing to a broader base. Q: How does the SuperBite kit compare to competitive offerings? A: John Treace, CEO, explained that the SuperBite system is designed to be capital and inventory efficient, with around 100 SKUs, compared to traditional systems with hundreds or thousands of SKUs. Q: How do you view the sales cadence and outlook for 2026 and 2027? A: John Treace, CEO, and Mark Hair, CFO, expressed confidence in the strategy and expect revenue growth to return in Q4 2026. They are cautious about 2027 but anticipate increased momentum and revenue growth exiting 2026. Q: What is the current market environment and consumer behavior? A: John Treace, CEO, noted that macro headwinds and consumer sentiment impacts on elective procedures continue. Q1 played out as expected, and the company remains focused on executing its strategies. Q: How has Lapiplasty trended, and what impact do new products have on it? A: John Treace, CEO, stated that there is strong demand for Lapiplasty where indicated. New products like MTP fusion have seen great uptake, and there is some pull-through from new product users adopting Lapiplasty. For the complete transcript of the earnings call, please refer to the full earnings call transcript.