Envista (NVST) Q1 2025 earnings summary

Executive summary

• Q1 2025 results met expectations, with core sales growth of 0.2% and adjusted EBITDA margin of 12.8%; adjusted EPS was $0.24, slightly ahead of expectations.

• Sales were $617 million, down 1.1% year-over-year, with growth in consumables, premium implants, and Spark aligners offset by declines in diagnostics and China ortho.

• Net income for Q1 2025 was $18 million, down 23.7% year-over-year; adjusted net income was $42 million.

• Share repurchase program underway, with over 1 million shares or $19 million repurchased in Q1.

• Leadership team refreshed, with improved employee engagement and retention.

Financial highlights

• Q1 2025 revenue was $617 million, with core sales up 0.2% year-over-year; reported revenue declined 1.1%.

• Adjusted gross margin was 54.8%, down from 57.4% year-over-year, mainly due to FX and product mix.

• Adjusted EBITDA margin was 12.8%, down from 14.0% a year ago.

• Adjusted EPS was $0.24, down $0.02 year-over-year but above expectations.

• Free cash flow was negative at -$5.1 million, reflecting seasonality and incentive compensation timing.

Outlook and guidance

• 2025 guidance maintained: 1%-3% core growth, ~14% adjusted EBITDA margin, and adjusted EPS of $0.95-$1.05.

• Tariff impacts expected to be offset by mitigation actions; net headwinds in Q2, tailwinds in second half.

• Spark deferral headwind of $4 million in Q1; expected to be neutral in Q2 and a tailwind in the second half.

• Restructuring savings of $20 million expected in 2025; majority to be realized this year.

• Sufficient liquidity for the next 12 months and beyond, with $1.08 billion in cash and access to a $750 million credit facility.