Integer Holdings Corp (ITGR) Q1 2025 Earnings Summary

Executive Summary

Q1 2025 delivered solid top-line and non-GAAP profitability: revenue $437.4M (+7.3% YoY; +6.3% organic), adjusted operating income $70.9M (+14% YoY), and adjusted EPS $1.31 (+14.9% YoY) .
Both revenue and adjusted EPS beat Wall Street consensus; GAAP EPS was a loss due to a one-time $46.7M debt conversion inducement from refinancing, while adjusted EBITDA rose 14% to $91.5M ; estimates context below (S&P Global).
Guidance raised: 2025 adjusted net income to $218–$231M (from $208–$221M) and adjusted EPS to $6.15–$6.51 (from $5.84–$6.20), driven by ~$13M interest expense reduction from the March 2030 convertible notes offering; CFO target increased to $235–$255M .
Near-term catalysts: continued strong C&V ramps (EP, structural heart) and the coatings tuck-ins (Precision Coating, VSi Parylene), plus capital structure optimization; leadership transition announced (CEO succession effective Oct 2025) supports continuity of strategy execution .

What Went Well and What Went Wrong

What Went Well
- Cardio & Vascular sales up 16.7% YoY (10.9% organic), driven by new EP product ramps and acquisitions; management reiterated outgrowing EP market and broader C&V momentum .
- Margin expansion in adjusted operating income: AOI as % of sales expanded ~100 bps YoY to ~16.2% from gross margin and OpEx leverage, supporting 14% AOI growth .
- Strategic refinancing: $1.0B 1.875% 2030 convert issued, exchanging ~77% of 2028 notes; expected ~$13M interest expense savings and +$0.31 to 2025 adjusted EPS outlook .
What Went Wrong
- GAAP loss: diluted EPS from continuing ops was -$0.66, primarily due to $46.7M debt conversion inducement expense recognized in “Other loss, net” .
- CRM&N growth slowed to 2.2% YoY (days headwind); management guides segment to low-to-mid single-digit growth near term (mix improving with PMA neuromodulation) .
- Other Markets declined 37.4% YoY (22.9% organic) due to planned multi-year Portable Medical exit; inorganic offsets are limited in 1H25 year-over-year comparisons .

Financial Results

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$431.4	$449.5	$437.4
GAAP Diluted EPS (Cont. Ops)	$1.01	$0.91	$(0.66)
Adjusted EPS	$1.43	$1.43	$1.31
Operating Income ($M)	$58.0	$57.0	$49.6
Adjusted Operating Income ($M)	$75.6	$76.0	$70.9
Adjusted EBITDA ($M)	$95.5	$95.1	$91.5

Segment breakdown ($USD Thousands):

Segment	Q3 2024	Q4 2024	Q1 2025
Cardio & Vascular	$241,009	$255,298	$258,871
CRM & Neuromodulation	$165,094	$170,524	$160,345
Other Markets	$25,314	$23,675	$18,176
Total	$431,417	$449,497	$437,392

Selected KPIs:

KPI	Q1 2024	Q1 2025
Cash from Operations ($M)	$23.2	$31.3
Capital Expenditures ($M)	$29.1	$25.2
Net Total Debt ($M)	$954.5 (Dec 31, 2024)	$1,229.6 (Mar 28, 2025)
Leverage Ratio (x)	2.6x (FY 2024 actual)	3.3x (Mar 28, 2025)

Notes:

Management cited Q1 gross margin rate of 28.7% vs. financial statements showing gross profit $120.3M on sales $437.4M; margin variability expected as new product lines ramp .

Guidance Changes

Metric	Period	Previous Guidance (Feb 20, 2025)	Current Guidance (Apr 24, 2025)	Change
Sales ($B)	FY 2025	$1.846–$1.880	$1.846–$1.880	Maintained
Adjusted Operating Income ($M)	FY 2025	$315–$331	$315–$331	Maintained
Adjusted EBITDA ($M)	FY 2025	$401–$422	$401–$422	Maintained
Adjusted Net Income ($M)	FY 2025	$208–$221	$218–$231	Raised
Adjusted EPS	FY 2025	$5.84–$6.20	$6.15–$6.51	Raised
CFO ($M)	FY 2025	$225–$245	$235–$255	Raised
Adjusted Total Interest Expense ($M)	FY 2025	$52–$57	$40–$42	Lowered
Adjusted Effective Tax Rate	FY 2025	19–21%	19–21%	Maintained
CapEx ($M)	FY 2025	$110–$120	$110–$120	Maintained
Leverage Ratio (x)	FY 2025	2.5x–3.5x	2.5x–3.5x	Maintained

Rationale: the March 2030 convert refinancing reduces 2025 interest expense by ~$13M and increases adjusted EPS outlook by $0.31 .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024, Q4 2024)	Current Period (Q1 2025)	Trend
Electrophysiology (EP) growth	Outgrowing EP market; strong ramps in EP and structural heart; raised 2024 profit midpoint	EP continues to outgrow; PFA content advantage; C&V strength drives top-line	Positive acceleration
CRM&N trajectory	Q3: +3% YoY; YTD +6.6% organic; normalized CRM growth	+2% YoY; days headwind; guide low-to-mid single-digit with improving mix via PMA neuromod	Moderating near term
Portable Medical exit	Q3: fulfillment timing elevated; planned multi-year exit	Other Markets -37% YoY from exit	Ongoing headwind (planned)
Tariffs/macro	2024 outlook steady; no immediate structural changes noted in 2024	Tariff impact estimated $1–$5M in 2025 AOI; sourcing largely U.S.; minimal China exposure; 2026 similar run-rate	Manageable, monitored
Capital structure	2024: leverage 2.6–2.7x; year-end leverage 2.6x	Issued $1.0B 2030 convert at 1.875%; exchanged ~77% 2028 notes; interest savings ~$13M	Optimization
Backlog/visibility	2024: balanced growth across segments	Order book ~$800M; visibility strong; expected to normalize by year-end	High near-term visibility
M&A tuck-ins	Pulse 2024; Precision Coating, VSi announced/closed early 2025	Coatings add proprietary capabilities; strong integration playbook; ~$59M inorganic contribution in 2025	Capability expansion

Management Commentary

“We delivered 14% adjusted operating income growth… We continue to expect sales growth of 8% to 10% and are raising our adjusted net income growth outlook to 19% to 26%.” — Joseph Dziedzic, CEO .
“Adjusted operating income as a percent of sales expanded ~100 bps YoY to ~16.2%, nearly 70 bps from gross margin and 30 bps from OpEx leverage.” — Diron Smith, CFO .
“We expect this [refinancing] to reduce our interest expense by approximately $13 million in 2025… raising the adjusted EPS outlook by $0.31.” — Diron Smith .
“Electrophysiology continues to outgrow the markets… PFA is an opportunity as we get higher content on average on the ablation catheter.” — Joseph Dziedzic .

Q&A Highlights

Tariffs: Management reaffirmed $1–$5M 2025 impact on adjusted operating income, insulated by customer-managed logistics outbound and primarily U.S.-sourced inbound; negligible China sourcing; 2026 impact likely similar .
CRM&N pacing: 2% YoY in Q1 due to fewer shipping days; longer-term mix to mid-single-digit growth as neuromodulation PMA products scale; overall Q1 sales at high end of guidance .
Backlog and inventory behavior: Order book ~$800M; no customer pull-forward behavior observed during tariff pause; Integer would discourage timing distortions that reduce operational efficiency .
Gross margin normalization: Q1 gross margin cited at 28.7%; variability expected as new programs ramp; AOI margin expansion remains in full-year plan .
M&A appetite: Focused on tuck-ins within 2.5x–3.5x leverage; coatings acquisitions already catalyzing customer engagement; ~$350–$400M annual capacity as leverage trends to low end by year-end .

Estimates Context

Q1 beat on both revenue and adjusted EPS; mixed results in prior quarters.

Metric	Q3 2024 Consensus*	Q3 2024 Actual	Q4 2024 Consensus*	Q4 2024 Actual	Q1 2025 Consensus*	Q1 2025 Actual
Revenue ($USD Millions)	$440.6	$431.4	$446.3	$449.5	$428.7	$437.4
Primary EPS ($)	$1.362	$1.43	$1.459	$1.43	$1.242	$1.31

Q1 2025: revenue beat and adjusted EPS beat; Q4 2024: revenue beat, EPS slight miss; Q3 2024: EPS beat, revenue miss. Values retrieved from S&P Global.*

Key Takeaways for Investors

Strong start to 2025 with double-digit non-GAAP profit growth; C&V momentum (EP, structural heart) and coatings tuck-ins underpin continued above-market organic growth (6–8%) .
Capital structure optimization is a tangible EPS lever; ~$13M interest savings and +$0.31 to 2025 EPS outlook create room for further inorganic investment while staying within 2.5x–3.5x leverage .
Watch CRM&N normalization and days effects; mix shift toward PMA neuromodulation supports mid-single-digit trajectory over time despite Q1 slowdown .
Portable Medical exit continues to be a headwind in “Other Markets,” but is planned; expect inorganic contributions to offset over the full year .
Tariffs appear manageable ($1–$5M AOI impact), with minimal China exposure and customer-managed outbound logistics; limited risk of inventory pull-forward behavior observed .
Backlog near ~$800M provides strong near-term visibility; expect normalization later in 2025 as capacity allocations mature (e.g., Ireland facility) .
Leadership transition announced (CEO to retire Oct 2025; COO becoming CEO) suggests continuity of strategy focused on targeted growth markets and manufacturing excellence .