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ARTIVION, INC. (AORT)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $0.099B, up 2% GAAP and 4% constant currency; non-GAAP EPS was $0.06 and adjusted EBITDA $17.5M, as product growth (stent grafts +19% CC, On‑X +11% CC, BioGlue +9% CC) offset a 23% CC decline in preservation services due to the late‑2024 cybersecurity incident .
  • Results beat Wall Street consensus: revenue $98.98M vs $94.81M estimate and EPS $0.06 vs ($0.10) estimate; management raised the FY revenue midpoint to $423–$435M and provided one‑time Q2 guidance of $107.5–$109.5M (13% CC at midpoint)* .
  • Mix, FX and onetime items: gross margin was 64.2% (down ~40bps y/y), with $4.7M cyber costs excluded from adjusted EBITDA and ~$2.9M FX gains benefiting other income .
  • Strategic catalysts: AMDS U.S. HDE launch building (≈150 facilities in IRB/VAC process) and Endospan NEXUS 30‑day IDE data showed 63% MAE reduction; both underpin medium‑term growth and margin expansion narratives .
  • Management reiterated adjusted EBITDA of $84–$91M for FY25 and expects preservation services to fully catch up by end of Q3, with sequential AMDS sales growth throughout 2025 .

*Values retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Strong product momentum: stent grafts +19% CC; On‑X +11% CC; BioGlue +9% CC, driving overall constant currency growth despite tissue headwinds .
  • AMDS HDE launch progressing: “approximately 150 facilities actively seeking IRB and value analysis committee approvals,” with training cadence accelerating and initial surgeon feedback highly positive .
  • NEXUS trial milestone: “30‑day outcomes… demonstrated a 63% reduction in MAE vs performance goal,” reinforcing confidence in a 2H26 PMA timeline .

What Went Wrong

  • Tissue processing backlog: preservation services down 23% CC in Q1 due to extended lead times from the cybersecurity incident; about one‑third of backlog cleared, with full catch‑up expected by end of Q3 .
  • Gross margin modestly lower: 64.2% vs 64.6% in the prior year on mix (lower high‑margin preservation services) and idle plant effects .
  • Elevated G&A: GAAP G&A $54.7M; non‑GAAP G&A $53.0M, reflecting higher non‑cash stock compensation and AMDS launch costs; cyber costs excluded from adjusted results .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Billions)$0.096 $0.097 $0.099
GAAP Diluted EPS ($USD)($0.05) ($0.39) ($0.01)
Adjusted Diluted EPS ($USD)$0.12 $0.00 $0.06
Adjusted EBITDA ($USD Millions)$17.701 $17.606 $17.548
Gross Margin ($USD Millions)$61.009 $61.502 $63.577

Q1 2025 actuals vs consensus:

MetricConsensusActual
Revenue ($USD Millions)94.8198.98
Primary EPS ($USD)(0.10)0.06

Values retrieved from S&P Global.

Segment breakdown (Q1 2025 vs Q1 2024):

SegmentQ1 2024 ($MM)Q1 2025 ($MM)
Aortic stent grafts$32.103 $36.602
On‑X$19.681 $21.574
Surgical sealants$16.981 $18.106
Other$2.349 $2.516
Total products$71.114 $78.798
Preservation services$26.317 $20.180
Total revenue$97.431 $98.978

Geography (Q1 2025 vs Q1 2024):

GeographyQ1 2024 ($MM)Q1 2025 ($MM)
North America$50.928 $47.793
EMEA$33.588 $37.045
Asia Pacific$7.609 $8.214
Latin America$5.306 $5.926

KPIs and cash metrics (Q1 2025):

KPIQ1 2025
Adjusted EBITDA Margin (%)17.7%
Cash and Equivalents ($MM)$37.7
Total Debt, net ($MM)$314.6
Net leverage (x)4.0
Cash from Operations ($MM)($16.953)
CapEx ($MM)($3.638)
Free Cash Flow, non‑GAAP ($MM)($20.591)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Millions)FY 2025$420–$435; 10–14% CC growth $423–$435; 11–14% CC growth Raised midpoint / tightened CC growth
Adjusted EBITDA ($USD Millions)FY 2025$84–$91 $84–$91 Maintained
Gross Margin (mix benefit)FY 2025~+100 bps (from AMDS mix) ~+100 bps reiteration implied via margin expansion narrative Maintained
Q2 2025 Revenue ($USD Millions)Q2 2025Not provided$107.5–$109.5 (~13% CC at midpoint) New one‑time quarterly guide
FX impact (as‑reported)FY 2025~−2% headwind at current rates Potentially neutral if current FX holds; no change to assumptions Narrative improved; assumptions maintained
AMDS cadenceFY 2025Sequential growth; +1–2 pts to FY growth Sequential growth; +1–2 pts to FY growth Maintained

Earnings Call Themes & Trends

TopicQ3 2024 (Previous Mentions)Q4 2024 (Previous Mentions)Q1 2025 (Current Period)Trend
Cybersecurity incident & recoveryNot yet occurred (reported later)~$4.5M revenue impact; timing headwinds for tissue/On‑X; Q1 to be weaker Near total return to normal ops; 1/3 tissue backlog cleared; full catch‑up by end‑Q3 Improving
AMDS U.S. HDE launchHDE not yet grantedHDE granted; outlining IRB/VAC/training; targeting top ~600 centers ~150 facilities in IRB/VAC; sequential sales growth expected Building
NEXUS IDE dataEnrollment completed; PMA target 2H26 Anticipated 30‑day data at AATS 30‑day data: 63% MAE reduction; PMA still on track 2H26 Positive momentum
On‑X valve positioning+15% CC growth; market share gains +10% CC; mortality benefit evidence (JACC/STS) +11% CC; constrained by supply; strong clinician tailwinds Sustained double‑digit with potential acceleration
Regional growthAPAC +23% CC; LATAM +32% CC LATAM +26% FY; strong OUS footprint LATAM +26% CC; APAC +8% CC; North America −6% Mixed (NA down; OUS strong)
FX & tariffsNegligible FY24 FX impact ~−2% FY25 FX headwind at then‑current rates FX could be neutral if rates hold; minimal China/tariff exposure Improving FX backdrop; limited tariff risk
R&D & PMA cadenceArcevo/Evita progress AMDS PMA shifted to mid‑2026 due to new bench testing standards AMDS clinical PMA module submitted; PMA timeline reiterated On track

Management Commentary

  • “Given our strong first quarter performance, we are raising the midpoint of our full year revenue expectations for 2025 and remain confident in our ability to grow adjusted EBITDA at twice the rate of constant currency revenue growth.” — Pat Mackin, CEO .
  • “Our as‑reported expenses include approximately $4.7 million in Q1 associated with the cyber incident… We anticipate seeking insurance reimbursement… We will exclude any insurance proceeds we receive from adjusted EBITDA as well.” — Lance Berry, CFO .
  • “Endospan… presented the NEXUS 30‑day data… the data met its protocol‑defined primary endpoints, demonstrating a 63% reduction in major adverse events relative to comparators… NEXUS remains on track for approval in the second half of 2026.” — Pat Mackin, CEO .
  • “We anticipate we will fully be caught up [on tissue backlog] by the end of the third quarter.” — Pat Mackin, CEO .

Q&A Highlights

  • AMDS rollout pace: ~150 facilities in IRB/VAC, timing varies by hospital; management comfortable with FY guide and sees upside if approvals accelerate .
  • Tissue growth trajectory: backlog clearing ahead of schedule; full‑year tissue growth expected mid‑single digits despite Q1 shortfall .
  • Cash flow: Q1 is seasonally weakest; expect FY positive FCF; AR collections lengthened due to manual invoicing during cyber event .
  • Endospan option timing and financing: AORT’s option triggers upon NEXUS PMA approval; upfront cost ~$135M net of prior loans; management confident in funding via EBITDA and cash flow .
  • FX and tariffs: FX could be neutral for FY if current rates hold; minimal China sales (<1%) and limited non‑U.S. sourcing; tariff impact expected immaterial .
  • On‑X supply: Q1 growth constrained; inventory rebuilding; strong clinical tailwinds expected to support sustained double‑digit growth .

Estimates Context

  • Q1 2025: Revenue $98.98M vs $94.81M consensus; Primary EPS $0.06 vs ($0.10) consensus — a material beat on both lines*.
  • FY 2025: Consensus revenue $441.75M vs company guidance $423–$435M (midpoint below consensus), suggesting potential estimate recalibration depending on AMDS launch cadence and FX*.
  • Q2 2025: Company guided $107.5–$109.5M vs consensus $107.95M, midpoint signals slight upside and sequential acceleration consistent with backlog catch‑up and AMDS ramp*.

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • Broad‑based product strength offset tissue headwinds, enabling a clean top‑line and EPS beat; margin was resilient despite mix and cyber costs — supportive of the “beat‑and‑raise” narrative .
  • Guidance raise (FY revenue midpoint) plus one‑time Q2 guide should sustain near‑term momentum; watch for sequential AMDS traction and tissue backlog clearance as catalysts .
  • Medium‑term thesis improving: AMDS mix and OUS stent graft growth underpin gross margin expansion; management reiterates adjusted EBITDA growth of 18–28% in FY25 .
  • Clinical validation is strengthening demand signals: On‑X mortality benefit in <60 yo patients and NEXUS 30‑day MAE reduction create new market opportunities and tailwinds .
  • FX backdrop has improved vs Q4 commentary; company maintains conservative assumptions, implying potential upside to as‑reported revenue if rates hold .
  • Balance sheet/liquidity: net leverage 4.0x in Q1 with path to lower leverage as EBITDA ramps; management confident in funding NEXUS option if exercised .
  • Trading setup: near‑term catalysts include Q2 revenue beat potential vs guide/consensus, accelerating AMDS adoption, and continued OUS strength; monitor cyber insurance reimbursements and AR normalization for FCF inflection .

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