Sign in
B&

Bausch & Lomb Corp (BLCO)·Q1 2025 Earnings Summary

Executive Summary

  • Revenue was $1.137B (+3% reported, +5% cc) with Vision Care and Surgical growing, while Pharmaceuticals was flat as reported; adjusted EPS ex IPR&D was ($0.07). The quarter missed Wall Street consensus on both revenue ($1.150B*) and EPS ($0.02*), driven by enVista IOL recall costs, FX headwinds, and U.S. generics softness .
  • Management raised full-year revenue guidance to $5.0–$5.1B and updated adjusted EBITDA ex IPR&D to $850–$900M to absorb the one-time recall impact and FX; constant-currency growth is now ~4.5–6.5% including recall, ~5.5–7.5% excluding it .
  • enVista IOLs returned to market about a month after the voluntary recall, with enhanced inspection protocols; surgeon feedback at ASCRS indicated rapid re-adoption, suggesting Q3–Q4 normalization in Implantables .
  • MIEBO momentum continued (Q1 revenue $57M, +8% seq; weekly TRx ~20k), while XIIDRA delivered $67M with +14% YoY TRx growth but heavier gross-to-net deductions; expect sequential improvement as seasonality fades and access investments pull through .
  • Key stock catalysts: fast recall resolution and ramp of premium IOLs, Daily SiHy sustained outperformance, and tariff mitigation progress; watch Q2 recall drag, tariff policy fluidity, and XIIDRA gross-to-net trajectory .

What Went Well and What Went Wrong

  • What Went Well
    • Premium IOLs and Implantables strength: Surgical grew +11% cc with Implantables +26% and Premium IOLs +77%, highlighting category momentum and supporting guidance confidence post recall .
    • Daily SiHy leadership: Daily SiHy revenue grew +42% cc (U.S. +56%), with INFUSE/ULTRA contributing; Blink OTC portfolio up +85% and dry eye OTC revenue $92M (+15%) .
    • Rapid enVista recovery: “Patient safety is nonnegotiable... We voluntarily pulled the lenses... Our ability to return to market approximately 1 month later is nothing short of remarkable” — Brent Saunders .
  • What Went Wrong
    • EPS and revenue miss vs consensus: Q1 revenue $1.137B vs $1.150B*; adjusted EPS ex IPR&D ($0.07) vs $0.02*; drivers include ~$16M recall impact, U.S. generics decline, and $7M FX headwind on EBITDA .
    • Margin compression: Adjusted gross margin fell to 59.5%, with ~140 bps one-time headwind from the recall and XIIDRA gross-to-net pressure in Q1 seasonally .
    • Tariffs overhang: Management quantified a potential ~120 bps adjusted EBITDA margin headwind in 2025 (not embedded in guidance), implying risk if policy persists .

Financial Results

Revenue and EPS progression (oldest → newest):

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Billions)$1.196 $1.280 $1.137
GAAP EPS ($)$0.01 ($0.01) ($0.60)
Adjusted EPS ($)$0.13 $0.25 ($0.15)
Adjusted EPS ex IPR&D ($)$0.17 $0.25 ($0.07)

Q1 2025 actual vs consensus:

MetricActual (Q1 2025)Consensus (Q1 2025)Outcome
Revenue ($USD Billions)$1.137 $1.150*Miss (~1.2%)
Primary EPS ($)($0.07) $0.02*Miss

Margins and profitability (oldest → newest):

MetricQ3 2024Q4 2024Q1 2025
Adjusted Gross Margin %63.0% 62.5% 59.5%
Adjusted EBITDA ex IPR&D ($USD Millions)$227 $259 $126
Operating Income (Loss) ($USD Millions)$43 $87 ($83)

Segment revenue (Q1 2025 vs Q1 2024):

SegmentQ1 2024 ($MM)Q1 2025 ($MM)Reported ChangeConstant Currency Change
Vision Care$635 $656 +3% +5%
Surgical$197 $214 +9% +11%
Pharmaceuticals$267 $267 0% +1%

Selected KPIs (Q1 2025):

KPIQ1 2025
MIEBO revenue$57M
XIIDRA revenue$67M
XIIDRA TRx YoY+14%
Dry Eye OTC revenue$92M; +15% growth
Daily SiHy revenue growth+42% cc (U.S. +56%)
Blink OTC growth+85%

Note: Asterisked values are estimates. Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious Guidance (Feb 19, 2025)Current Guidance (Apr 30, 2025)Change
Full-Year RevenueFY 2025$4.950B–$5.050B; ~5.5–7.5% cc growth $5.000B–$5.100B; ~4.5–6.5% cc incl recall; ~5.5–7.5% cc excl recall Raised range midpoint; cc lowered incl recall
Adjusted EBITDA ex IPR&DFY 2025$900M–$950M $850M–$900M Lowered (recall absorption)
FX headwinds (Revenue)FY 2025-$100M Nominal Improved
FX headwinds (Adj. EBITDA ex IPR&D)FY 2025-$20M Nominal Improved
One-time enVista recall (Revenue)FY 2025N/A~-$55M New item
One-time enVista recall (Adj. EBITDA ex IPR&D)FY 2025N/A~-$65M New item

Earnings Call Themes & Trends

TopicQ3 2024 (Previous)Q4 2024 (Previous)Q1 2025 (Current)Trend
AI/technology & digitalLaunched Opal marketplace; AI in lens manufacturing sites Continued AI/data collaborations; digital sales platform highlighted Introduced Arise cloud-based lens fitting; digital initiatives ongoing Expanding scope
Supply chain & operationsNetwork optimization; Milan/Berlin capacity adds Operating metrics improved; supply stabilization Voluntary enVista recall; rapid return to production and market with enhanced inspection Resilient execution
Tariffs/macroCurrency headwinds noted 2025 FX headwind guided; macro monitored Potential ~120 bps EBITDA margin headwind; mitigation levers in motion Rising risk; mitigations underway
Product performance (Dry eye)MIEBO launch strength; XIIDRA TRx momentum; OTC Blink +35% MIEBO $172M FY; XIIDRA $364M FY; OTC growth MIEBO $57M; XIIDRA $67M; Dry Eye OTC $92M (+15%) Sustained momentum
Surgical (IOLs)FDA approval enVista Envy; Implantables +13% Premium IOLs revenue +35% FY; LuxLife Europe launch expected Implantables +26%; Premium IOLs +77%; recall impact quantified; return underway Strong, recovering from recall
Regulatory/legalNone materialEnVista Envy FDA approval enVista voluntary recall and root cause established; regulator engagement Issue resolved; oversight strengthened
Regional trendsChina CL +16% China CL +12% Q4 China CL +6% Q1; U.S. demand resilient Still positive, moderating

Management Commentary

  • “Patient safety is nonnegotiable... We voluntarily pulled the lenses... [and] returned to market approximately 1 month later” — Brent Saunders on enVista .
  • “We delivered mid-single-digit constant currency revenue growth... currency was a headwind of ~$19M to revenue and ~$7M to adjusted EBITDA” — CFO Sam Eldessouky .
  • “Daily SiHy... grew a staggering 98% year-over-year prescriptions... 37% increase from Q4” — Brent Saunders on momentum and DTC impact .
  • “We estimate tariffs to be a potential headwind of approximately 120 bps to adjusted EBITDA margin in 2025... our updated guidance does not reflect the potential tariff impact” — CFO .
  • “Miebo... we have very high expectations... profitable starting next year” — Brent Saunders on MIEBO trajectory .

Q&A Highlights

  • enVista recall impact and surgeon sentiment: Surgeons at ASCRS expressed strong trust and prompt re-adoption; management expects Q2 impact, then recovery in Q3–Q4 .
  • Tariff phasing and mitigation: Q2 “well protected” via inventory/logistics; second-half exposure balanced across Q3/Q4, with further levers (manufacturing shifts, pricing) under evaluation .
  • XIIDRA dynamics: Volume/TRx growth strong; gross-to-net pressure seasonally highest in Q1; programs rolling out to improve profitability; full-year XIIDRA strategy unchanged .
  • Consumer demand vs destocking: Retailer inventory rebalancing persists, but consumption remains robust across brands; essential health products provide resilience; China CL +6% .
  • Surgical pipeline: LuxLife EU launch, MIGS (Elios) anticipated U.S. approval late 2025/early 2026; additional premium IOL launches and equipment upgrades forthcoming .

Estimates Context

  • Q1 2025 vs Wall Street consensus (S&P Global): Revenue $1.137B vs $1.150B* (miss); Primary EPS ($0.07) vs $0.02* (miss). Estimate shortfall reflects recall cost ($16M), FX ($19M revenue headwind), and U.S. generics pressure .
  • Near-term modeling: Management reiterated seasonality (Q1 lowest, Q4 highest), Q2 more recall impact, with Implantables ramp in Q3–Q4; tariff impact excluded from guidance pending mitigation and policy clarity .

Note: Asterisked values are estimates. Values retrieved from S&P Global.

Key Takeaways for Investors

  • The quarter was a controlled reset: core growth intact (Vision Care +5% cc; Surgical +11% cc), but recall/FX/generics drove a consensus miss; watch margin normalization as recall fades .
  • Guidance is credibly adjusted: revenue range raised and FX improved; EBITDA lowered to absorb recall; management articulated clear phasing and recovery trajectory .
  • Premium IOLs are a 2H catalyst: rapid enVista return plus LuxLife EU launch should re-accelerate Implantables; Q2 is the trough, with Q3–Q4 ramp .
  • Daily SiHy and OTC brands drive durable growth: structural share gains in lenses and strong DTC execution (Blink, LUMIFY) support top-line resilience across cycles .
  • XIIDRA/MIEBO strategy is working: expect volume growth to outpace Q1 gross-to-net headwinds; MIEBO profitability inflects in 2026 with continued DTC and access leverage .
  • Tariffs are a policy overhang but manageable: 120 bps EBITDA headwind potential not in guidance; inventory, manufacturing shifts, and pricing provide levers; monitor updates .
  • Trading setup: Expect near-term volatility around Q2 recall costs and tariff headlines; positioning into Q3–Q4 for Implantables recovery and sustained Daily SiHy/OTC momentum could be attractive if execution and mitigation progress continue .