Alphatec (ATEC) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue grew 22% year-over-year to $169–$169.2 million, with surgical revenue up 24% to $152 million, driven by 17% procedural volume growth and 18% new surgeon adoption.

• Adjusted EBITDA reached $11 million (6% margin), marking an 840 bps year-over-year improvement and the second-best quarter ever.

• Free cash use improved by $55 million year-over-year, with Q1 free cash flow at ($15 million) and ending cash balance at $153–$153.2 million.

• Net loss widened to $51.9–$52 million, or $(0.35) per share, reflecting higher operating and litigation-related expenses.

• Successfully refinanced 2026 convertible debt, issuing $405 million in 2030 notes, repurchasing 80% of 2026 notes, and entering capped call transactions.

Financial highlights

• Total revenue: $169–$169.2 million, up 22% year-over-year; surgical revenue: $152 million (+24%), EOS revenue: $17 million (+8%).

• Gross margin: 68.6–70% (down 50–170 bps year-over-year); non-GAAP gross margin 70%.

• Adjusted EBITDA margin: 6%, up 800–840 bps year-over-year.

• Net loss: $51.9–$52 million, or $(0.35) per share, compared to $48.5 million, or $(0.34) per share, year-over-year.

• Free cash use: $15 million, at the favorable end of guidance.

Outlook and guidance

• Full-year 2025 revenue outlook raised to $734 million (20% growth), with surgical revenue expected at $658 million (+21%) and EOS revenue at $76 million.

• Adjusted EBITDA guidance increased to $78 million (11% margin), with positive free cash flow expected for 2025.

• Cash flow expected to be positive for full year 2025, with Q2 cash flow between $0–$5 million and positive in Q3 and Q4.

• Targeting 18% adjusted EBITDA margin at $1 billion revenue by 2027.

• Ongoing investments in R&D and commercial infrastructure to support long-term growth.