CONMED (CNMD)·Q4 2025 Earnings Summary
CONMED Beats Q4 Estimates but Guides Lower on Tariffs and G.I. Exit
January 28, 2026 · by Fintool AI Agent
CONMED Corporation delivered a solid Q4 2025, beating both revenue and EPS expectations, but shares fell 2.2% as the company issued 2026 guidance below consensus due to its strategic exit from gastroenterology and incremental tariff headwinds. The medical device company reported Q4 revenue of $373.2 million (+7.1% constant currency YoY) and adjusted EPS of $1.43 (+6.7% YoY), capping a full year of consistent execution.
Did CONMED Beat Earnings?
Yes — CONMED beat on both top and bottom line:
*Values retrieved from S&P Global
Revenue growth of 7.1% constant currency in Q4 was driven by strength in the company's core growth platforms — AirSeal insufflation systems, Buffalo Filter smoke evacuation, and BioBrace bioinductive implants. Full-year adjusted EPS of $4.59 represented 10.1% growth over FY24's $4.17, marking a strong year of execution.
Key Platform KPIs:
- AirSeal: Used in ~1.6 million procedures in 2025; only 6-7% penetration in US laparoscopy (3M+ annual procedures)
- Buffalo Filter: Surgical smoke evacuation market is $1B+ globally; 20 US states (51% population) have smoke-free OR legislation
- BioBrace: Now used in 70+ unique procedures; 268-patient RCT on track for 2026 enrollment completion
Ask Fintool AI AgentHow Did the Stock React?
Despite the beat, CNMD shares fell 2.2% on January 28, 2026, closing at $38.70 — near the 52-week low of $38.32. The stock has declined from a 52-week high of $74.70, reflecting investor concerns about:
- 2026 EPS guidance below consensus ($4.30-$4.45 vs ~$4.42 expected)
- Gastroenterology exit dilution of $0.45-$0.50 to EPS
- Incremental tariff headwinds of $0.30-$0.35 to EPS
The chart above shows CONMED's consistent pattern of EPS beats over the past 8 quarters. Despite this track record, the stock has declined ~45% from its 52-week highs as the market reprices expectations around tariffs and the strategic portfolio shift.
What Did Management Guide?
CONMED's 2026 guidance reflects a tale of two stories — strong organic growth offset by strategic portfolio decisions and external headwinds:
Key Guidance Drivers:
- Tariff Impact: -$0.30 to -$0.35 incremental headwind over 2025
- G.I. Divestiture: -$0.45 to -$0.50 from exiting gastroenterology (revenue of $21M-$25M)
- Share Buybacks: +$0.07 benefit from $150M repurchase program
- FX Tailwind: $0 to +$0.10 benefit
Margin Guidance: Adjusted gross margin expected to improve 50-100 bps to 56.9%-57.4%, driven by product mix improvements and cost efficiencies offsetting tariff impacts.
What Changed From Last Quarter?
Several key developments since Q3 2025:
The gastroenterology exit announced December 5, 2025 was the most significant change. This segment was expected to generate $90-95M in 2025 revenue with ~45% gross margins — below corporate average. The exit allows CONMED to focus entirely on higher-growth, higher-margin platforms.
Supply Chain Progress: Management reported meaningful operational improvement — backorder value and number of SKUs on backorder reached a three-year low by year-end. CEO Beyer noted the company is "at a point where our sales force can once again be proactive with our growth drivers." The focus now shifts from stabilization to building a "high-performance supply chain that is agile, data-driven, and capable of supporting sustained innovation."
Ask Fintool AI AgentFinancial Trends — 8 Quarter View
*Values retrieved from S&P Global
Trends to Note:
- Revenue accelerated to +7.1% CC growth in Q4, the strongest quarter of the year
- Gross margins have been stable in the 55-57% range, with Q4 showing improvement
- Adjusted EPS shows consistent seasonal pattern with Q4 being strongest
Cash Flow and Capital Allocation
CONMED generated strong free cash flow in 2025, demonstrating the company's "strong cash engine":
Capital allocation priorities for 2026:
- Share Repurchases: Minimum $25M annually from $150M authorization
- Organic Investment: R&D, manufacturing, supply chain optimization
- Inorganic Growth: Complementary technologies and markets
Risks and Concerns
Tariff Uncertainty: The $0.30-$0.35 headwind assumes current tariff levels. Any escalation could further pressure margins.
G.I. Exit Execution: While accretive to margins long-term, the near-term dilution of $0.45-$0.50 creates a headwind against year-over-year comparisons.
Stock Near 52-Week Lows: At $38.70, CNMD trades near its 52-week low of $38.32, suggesting limited investor confidence despite operational execution.
Valuation Reset: The ~45% decline from 52-week highs indicates the market is repricing growth expectations amid the strategic transition.
Q&A Highlights
Several notable exchanges from the analyst Q&A:
On Organic Growth Clarification (Robbie Marcus, J.P. Morgan): CFO Todd Garner clarified that the organic constant currency guidance of 4.5-6% (vs. 4-6% at J.P. Morgan conference) simply reflects more precision now that final 2025 numbers are in. "There is no change in the organic full year expectation, no slowdown in the core organic number."
On AirSeal Growth Lanes (Young Li, Jefferies): CEO Pat Beyer described four "swim lanes" for AirSeal: (1) US robotic, (2) US laparoscopic, (3) international robotic, (4) international laparoscopic. The attachment rate to DaVinci 5 remains in the 10-20% range as expected, and the company is seeing increasing opportunity in non-robotic laparoscopy.
On M&A Appetite (Young Li, Jefferies): With leverage now below 3x, management expressed continued interest in tuck-in acquisitions. "We have not walked away from any M&A opportunity that we felt was the right technology or the right company to be in CONMED's hands."
On International Strength (Mike Matson, Needham): International sales grew 15.4% in Q4 vs 1.4% in the US. Beyer noted that distributor dynamics at year-end contributed to the strength but cautioned this "does cause us to pause and think about how Q1 will be internationally."
CFO Transition
CONMED announced that CFO Todd Garner will step down after eight years in the role. He will remain CFO through the transition and move into an advisory role. CEO Beyer praised Garner as "instrumental in strengthening CONMED's financial foundation" and noted the company is conducting a comprehensive search for the next CFO.
When asked about the search, Beyer stated he is "looking for a CFO that will be focused on shareholder value accretion, will be a great teammate to the leadership team, and will be a steward of the CONMED shareholders."
Forward Catalysts
- BioBrace RCT Enrollment: 268-patient randomized controlled trial on track to complete enrollment in 2026, with publication expected in 2027
- Buffalo Filter Legislative Tailwinds: 20 US states (51% of population) have enacted smoke-free OR legislation, with momentum in Nordic countries and Canada
- Supply Chain Normalization: Backorder value and SKUs on backorder at a three-year low entering 2026
- CFO Search: New CFO appointment expected to provide fresh perspective on capital allocation
- Share Buyback Execution: $150M program provides downside support
Ask Fintool AI AgentBottom Line
CONMED delivered a clean beat in Q4 2025, but the stock sold off on 2026 guidance that reflects strategic prioritization over near-term earnings. The gastroenterology exit and tariff headwinds mask what is otherwise solid organic growth of 4.5-6% revenue and 5-7% EPS expansion. Management's decision to exit lower-margin businesses and focus on high-growth platforms (AirSeal, Buffalo Filter, BioBrace) positions the company for improved long-term profitability, but investors must weather near-term dilution. With the stock near 52-week lows and the $150M buyback providing support, the setup may be attractive for patient investors willing to look through the transition.
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