Smith & Nephew (SN) Q1 2026 TU earnings summary

Executive summary

• Q1 2026 revenue reached $1,501 million, up 6.6% reported and 3.1% underlying, with strong growth in Sports Medicine and resilient Advanced Wound Management offsetting softness in US knees.

• Over half of growth was driven by innovation and products launched in the last five years, including CATALYSTEM, Q-FIX, REGENETEN, LEAF, AETOS, CARTIHEAL AGILI-C, FASTSEAL, and OASIS.

• Announced a $500 million share buyback, fully funded by free cash flow and cash balances, reflecting confidence in the outlook.

• The RISE strategy is progressing, with new clinical data, product launches, and the acquisition of Integrity Orthopaedics.

Financial highlights

• Q1 2026 revenue: $1,501 million, up 3.1% underlying and 6.6% reported, with a 350bps FX tailwind.

• Sports Medicine & ENT revenue: $491 million (+6.7% underlying, +10.4% reported); Advanced Wound Management: $411 million (+2.2% underlying, +6.6% reported); Orthopaedics: $599 million (+0.8% underlying, +3.7% reported).

• Emerging Markets delivered 10.5% underlying growth, while US and Other Established Markets grew 2.1% and 1.0%, respectively.

• Free cash flow for 2026 expected at ~$800 million.

Outlook and guidance

• Full-year 2026 guidance unchanged: underlying revenue growth around 6%, trading profit growth around 8%, trading profit ~$1.3 billion, free cash flow ~$800 million, and ROIC above 10%.

• Revenue and profit growth expected to be stronger in the second half of 2026, supported by product launches and stabilization in US knees and skin substitutes.

• China expected to be neutral to growth for the first time since 2021.

• Guidance reaffirmed despite inflation and input cost concerns; hedging and cost savings programs in place.