Globus Medical — Third Quarter 2026 Earnings Summary

Financial Performance:

• Worldwide net sales for the third quarter of 2026 were $763.7 million, a decrease of 0.7% (or 0.5% on a constant currency basis) compared to the prior year quarter.
• Base business sales (non-GAAP), excluding Nevro, were $690.0 million, an increase of 3.0% year-over-year.
• GAAP net income was $141.2 million, an increase of 18.7% compared to the prior year quarter.
• GAAP diluted EPS was $1.04, an increase of 18.2% year-over-year.
• Non-GAAP diluted EPS was $1.23, an increase of 4.4% year-over-year.
• GAAP gross profit as a percentage of net sales was 66.7%, an increase of 2.5 percentage points.
• Non-GAAP adjusted gross profit as a percentage of sales was 69.5%, an increase of 1.4 percentage points.
• Net cash provided by operating activities for the nine months ended September 30, 2026, was $677.3 million.
• Non-GAAP free cash flow for the nine months ended September 30, 2026, was $564.2 million.
• Cash and cash equivalents were $441.3 million as of September 30, 2026.
• Total cash, cash equivalents, and marketable securities were $871.2 million as of September 30, 2026.

Guidance and Future Outlook:

• Full-year 2026 revenue guidance was updated to $3.09 billion, representing 5.1% revenue growth compared to fiscal 2025.
• Full-year fiscal 2026 non-GAAP fully diluted EPS guidance was reaffirmed to be in the range of $4.95 to $5.05, representing 24.4% to 26.9% growth over fiscal 2025.
• Management highlighted a commitment to delivering consistent adjusted gross profit margin expansion and bottom-line profit.
• The company reported the eighth straight quarter of sequential adjusted gross profit margin expansion.

Business Segments and Product Lines:

• U.S. Spine business grew 2% in the third quarter of 2026, compared to double-digit growth in the prior year quarter; on a two-year average basis, the business is growing mid-single digits.
• Enabling Technologies strategy delivered revenue growth of 24% in the third quarter.
• Deployment of robot and navigation units increased by 73% compared to the prior year quarter.
• Net sales by product category for the third quarter: Musculoskeletal Solutions were $728.9 million, and Enabling Technologies were $34.9 million.
• U.S. net sales increased 0.5% year-over-year, while International net sales decreased 5.7% (or 5.0% on a constant currency basis).

Market and Competitive Landscape:

• Management stated the company is capturing share in the market through innovation and differentiation.
• The company focuses on a "closed-loop surgical intelligence ecosystem" integrating patient selection, surgical techniques, implants, and technology.

Risks and Challenges:

• U.S. Spine faced difficult prior year comparables.
• International net sales declined on both an as-reported and constant currency basis.
• Forward-looking statements note risks including health epidemics, ability to manage growth, demand for products, competition, ability to convince surgeons to use products, and ability to defend legal proceedings.

Management Commentary and Tone:

• Keith Pfeil, President and CEO, noted that third-quarter revenue finished at $764 million, down slightly from the prior year, but emphasized the company's ability to capture share and lead with innovation.
• Kyle Kline, CFO, stated that performance reflects disciplined execution and positions the company to deliver sustained earnings growth, cash generation, and enhanced shareholder returns.
• Management expressed confidence in the long-term growth profile and underlying earnings and cash generation prowess.

Other Key Points:

• The Board of Directors authorized a $500 million increase to the existing share repurchase program on November 2, 2026.
• The share repurchase program has no expiration date and may be suspended or discontinued at any time.
• The company acquired Nevro Corp. in 2025; base business sales exclude Nevro's contribution.
• The company delivered record quarterly operating cash flow and free cash flow generation for the third quarter.