Zimmer Biomet (ZBH) investor relations material

Executive summary

• Net sales for Q1 2026 reached $2.087 billion, up 9.3% year-over-year, driven by acquisitions, favorable currency, and new product launches, with organic growth at 2.9%.

• Adjusted EPS rose 15% to $2.09, with GAAP diluted EPS up 34.1% to $1.22, including a $0.20 tariff-related benefit and a $30 million U.S. tariff refund adjustment.

• Strategic priorities advanced in people, culture, operational excellence, and innovation, with key leadership hires and investments in robotics and digital platforms.

• Paragon 28 and OrthoGrid acquisitions accelerated growth, and Monogram/mBôs clinical study enrollment completed, supporting future product launches.

• Operating cash flow was $359.4 million, with free cash flow at $245.9 million.

Financial highlights

• Net sales were $2.087 billion, up 9.3% reported and 2.9% organically, with Paragon 28 contributing 3.9% to growth.

• Adjusted gross margin was 73%, and adjusted operating margin was 27.3%, both up year-over-year.

• GAAP diluted EPS was $1.22 (vs. $0.91 prior year); adjusted EPS was $2.09 (vs. $1.81 prior year).

• Operating profit was $373.2 million (reported) and $570.5 million (adjusted); net earnings were $238.1 million (GAAP) and $409.4 million (adjusted).

• $250 million in share repurchases completed in Q1.

Outlook and guidance

• Full-year 2026 organic constant currency revenue growth guidance maintained at 1%-3%; reported sales guidance at 2.5%-4.5%.

• Adjusted EPS guidance raised to $8.40-$8.55; free cash flow growth guidance raised to 9%-11%.

• Operating margins expected to be down slightly less than 50 bps from 2025, with Q2 margins down ~200 bps year-over-year.

• Paragon 28 to contribute ~1% to reported sales growth until April 2026.

• Foreign currency expected to add 0.5% to 2026 sales growth.