Globus Medical (GMED) Q1 2025 earnings summary

Executive summary

• Q1 2025 net sales were $598.1 million, down 1.4% year-over-year (0.8% decrease constant currency), mainly due to softer enabling technology sales, supply chain disruptions, and timing of distributor orders, partially offset by U.S. spine growth.

• GAAP net income was $75.5 million, a turnaround from a net loss of $7.1 million in Q1 2024, with diluted EPS at $0.54 versus a loss of $0.05; non-GAAP EPS rose 8.5% to $0.68.

• Record free cash flow of $141.2 million, up 493% year-over-year, and operating income of $97.0 million, compared to a loss of $8.6 million in Q1 2024.

• The company returned to debt-free status, repaid $900 million in NuVasive merger debt, and completed a $250 million all-cash acquisition of Nevro in April 2025.

• Q2 is off to a strong start as supply chain issues are resolved and back orders are filled.

Financial highlights

• U.S. net sales grew 0.2% year-over-year; international net sales declined 7.7% as reported and 4.6% constant currency.

• Adjusted EBITDA was $177.8 million (29.7% of net sales), up from $154.0 million (25.4%) in Q1 2024.

• Gross margin improved to 63.6% from 55.3% year-over-year; adjusted gross margin was 67.3%.

• Cash and equivalents were $461.3 million at quarter-end, down from $956.2 million at year-end due to debt repayment and share repurchases.

• Free cash flow reached a record $141.2 million, up $117 million year-over-year.

Outlook and guidance

• 2025 net sales guidance reaffirmed at $2.8–$2.9 billion.

• Non-GAAP EPS guidance lowered to $3.00–$3.30 (from $3.10–$3.40) due to earlier-than-expected Nevro deal closing and associated costs.

• Management expects continued investment in product launches, sales force expansion, and international growth.

• Integration of the Nevro acquisition is expected to generate synergies but may involve additional costs and risks.

• Q2 is showing positive momentum, with expectations to recover Q1 softness, especially in enabling tech and spine.