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 strong procedural volume and new surgeon adoption.

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

• Free cash use improved by $55 million year-over-year, with an ending cash balance of $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 $405 million in convertible debt, extending maturity to 2030 and repurchasing 80% of 2026 notes.

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); GAAP gross profit: $116 million.

• Adjusted EBITDA: $11 million (6% margin), up from a loss of $3 million in Q1 2024.

• Operating expenses: $124 million non-GAAP (74% of sales), $140.7–$160.3 million GAAP, up 8–14% year-over-year.

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

Outlook and guidance

• 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 full year 2025.

• Company expects to be cash flow positive in Q3 and Q4 2025.

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

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