Alphatec (ATEC) investor relations material

Executive summary

• Q1 2026 revenue reached $192 million, up 14% year-over-year, with surgical revenue at $178 million, growing 17% year-over-year, driven by a 21% increase in case volume and strong new surgeon adoption.

• Adjusted EBITDA was $21 million (11% margin), nearly doubling year-over-year and expanding 460 basis points.

• Net loss narrowed to $33.9 million from $51.9 million in Q1 2025, reflecting higher revenue and lower litigation and restructuring expenses.

• Free cash use was $11 million for the quarter, with trailing twelve-month free cash flow improving to $7 million and ending cash balance at $140 million.

• Continued innovation and product launches, with strong adoption of EOS Insight and Valence® navigation systems.

Financial highlights

• Gross margin improved to 71.6% (non-GAAP up to 72%), up over 120 basis points year-over-year, driven by asset efficiency and cost improvements.

• Operating profit margin rose to 2.9%, a 600 basis point improvement year-over-year.

• Non-GAAP operating expenses grew 6% year-over-year, below revenue growth, reflecting operating leverage.

• Free cash used was $11 million, with $33 million invested in inventory and instruments to support growth.

• Interest expense rose 49% to $11.7 million, mainly due to amortization of debt discount on 2030 Notes.

Outlook and guidance

• Full-year 2026 revenue expected at $882 million (15% growth), with surgical revenue at $805 million (17% growth) and EOS revenue at $77 million.

• Adjusted EBITDA guidance maintained at $134 million (15% margin), with at least $20 million in free cash flow expected for the year.

• Q2 growth expected to mirror Q1 at 14%, with acceleration to 17% in the second half as EOS contributions increase.

• Revenue per procedure expected to be flat year-over-year, with high teens volume growth.

• Liquidity is considered adequate for ongoing operations, with access to new credit facilities post-quarter.