Zimmer Biomet (ZBH) 43rd Annual J.P. Morgan Healthcare Conference 2025 summary

Key messages and strategic focus

• Positioned at the forefront of an innovation cycle, emphasizing operational excellence and financial commitments for 2025.

• Resolved core operational challenges, including the 2024 ERP issue, and implemented new operating mechanisms to address performance headwinds.

• Committed to mid-single-digit revenue growth, EPS leverage of 1.5x revenue, and free cash flow growth at least 100bps faster than EPS over the long-range plan.

• Plans to return 65% of free cash flow to investors via dividends and buybacks, while maintaining capacity for responsible and strategic M&A.

Product innovation and launches

• Over 50 new product launches, including cementless knee and partial systems, Persona OsseoTi, Persona Revision, Oxford Cementless Partial Knee, and ROSA Shoulder.

• Full portfolio in hips and knees now complete, with launches transitioning to full deployment in 2025.

• New products command up to a 15% price premium and target substantial market share gains by 2027.

• Expansion beyond large joints with S.E.T., Tech & Data products, ablation systems, navigation tools, and connected care analytics.

• Several products are pending regulatory approval, with launches scheduled throughout 2024.

Operational excellence and organizational changes

• Achieved 12 consecutive quarters of mid-single-digit revenue growth and near 30% operating margin.

• Improved days of inventory on hand by over 50 days since 2020, with further reductions targeted to boost free cash flow.

• Leadership realignment, ERP remediation, salesforce specialization, and R&D optimization implemented.

• Enhanced pricing controls, with 70 basis points of favorability in Q3 2024 and a focus on further gains.

• Inventory rationalization and alignment of sales quotas with growth targets.