Integra LifeSciences (IART) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $382.7 million, up 3.7% year-over-year, but organic revenue declined 3.5% due to ship holds and supply disruptions.

• Adjusted EPS was $0.41, down 25% year-over-year, and GAAP net loss widened to $25.3 million ($0.33 per share) due to operational and quality issues.

• Gross margin declined to 50.8% GAAP (from 56.1%) and 62.2% adjusted (from 64.4%), reflecting higher costs and supply chain challenges.

• The company is executing a turnaround with new leadership, operational improvements, and a focus on compliance and transformation.

• Compliance Master Plan and remediation efforts are ongoing, with most actions expected by year-end and some extending into 2026.

Financial highlights

• Q1 2025 reported revenue: $382.7 million (+3.7%); organic revenue: $355.8 million (-3.5%).

• Adjusted EPS: $0.41 (down 25% year-over-year); GAAP EPS: $(0.33); adjusted net income: $31.7 million.

• Adjusted EBITDA margin: 16.6% (down 290 bps); adjusted gross margin: 62.2% (down 220 bps).

• Operating cash flow: $(11.3) million; free cash flow: $(40.2) million due to higher capex.

• Net debt at quarter-end: $1.58 billion; total liquidity: $1.16 billion.

Outlook and guidance

• Q2 2025 revenue expected at $390–$400 million (reported decline 6.8%–4.4%, organic decline 7.5%–5.1%).

• Full-year 2025 revenue guidance reaffirmed at $1.65–$1.72 billion; adjusted EPS guidance lowered to $2.19–$2.29 due to $0.22 per share tariff impact.

• Ship holds for 2025 now expected at $55–$70 million, up from $27 million previously identified.

• Tariffs expected to impact 2025 by $22 million or $0.22 per share; mitigation strategies are being pursued but not yet reflected in guidance.

• Sequential improvement in revenue expected in H2 2025, driven by Integra Skin production ramp, private label recovery, and seasonal demand.