PLANO, Texas, Oct. 29, 2026 (GLOBE NEWSWIRE) — Integer Holdings Corporation (NYSE:ITGR) today announced results for the three months ended October 2, 2026.
Third Quarter 2026 Highlights (compared to Third Quarter 2025, except as noted)
- Sales decreased 3.9% to $450 million. Organic sales decreased 2.2%.
- GAAP operating income from continuing operations totaled $28 million, a decrease of $28 million or 50%. Non-GAAP adjusted operating income totaled $66 million, a decrease of $20 million or 23%.
- GAAP income from continuing operations totaled $15 million, a decrease of $25 million or 62%. Non-GAAP adjusted net income totaled $46 million, a decrease of $17 million or 27%.
- GAAP diluted EPS from continuing operations totaled $0.43, a decrease of $0.68 or 61%. Non-GAAP adjusted EPS totaled $1.34, a decrease of $0.45 or 25%.
- Adjusted EBITDA totaled $88 million, a decrease of $18 million or 17%.
- From the end of 2025, total debt increased $34 million to $1.219 billion and Non-GAAP net total debt increased $33 million to $1.223 billion, resulting in a leverage ratio of 3.3 times adjusted EBITDA as of October 2, 2026.
As previously announced, given Integer’s pending acquisition by an affiliate of investment funds managed by KKR (the “Transaction”) pursuant to the Agreement and Plan of Merger, dated as of August 2, 2026, by and among Integer, Armstrong Parent, Inc. (“Parent”), and Armstrong Bidco, Inc. (the “Merger Agreement”), the Company is not providing a financial outlook and will not host a conference call to discuss its third quarter 2026 financial results. On September 29, 2026, the Company received early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and on October 21, 2026, Integer’s stockholders approved the adoption of the Merger Agreement. The Transaction is anticipated to close by the end of 2026, subject to the satisfaction or waiver of the remaining customary closing conditions specified in the Merger Agreement, including receipt of required regulatory approvals.
Discussion of Product Line Third Quarter 2026 Sales
- Cardio & Vascular sales decreased 5% to $263 million in the third quarter 2026 compared to the third quarter 2025, reflecting the previously communicated impact from the two new Electrophysiology products.
- Cardiac Rhythm Management & Neuromodulation sales increased 4% to $176 million in the third quarter 2026 compared to the third quarter 2025. Growth was partially offset by the previously communicated impact from the one new Neuromodulation product.
- Other Markets sales totaled $11 million in the third quarter 2026, compared to $21 million in the third quarter 2025, primarily due to the Portable Medical exit.
Summary Financial Results
(dollars in thousands, except per share data)
|
| |
|
|
|
| |
Three Months Ended |
|
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
QTD
Change |
|
October 2,
2026 |
|
September 26,
2025 |
|
YTD
Change |
| Operating income |
$ |
28,209 |
|
$ |
56,439 |
|
(50.0) % |
|
$ |
94,606 |
|
$ |
165,329 |
|
(42.8)% |
| Income from continuing operations |
$ |
14,978 |
|
$ |
39,678 |
|
(62.3) % |
|
$ |
55,089 |
|
$ |
54,222 |
|
1.6% |
| Diluted EPS from continuing operations |
$ |
0.43 |
|
$ |
1.11 |
|
(61.3) % |
|
$ |
1.60 |
|
$ |
1.52 |
|
5.3% |
| |
|
|
|
|
|
|
|
|
|
|
|
| EBITDA(a) |
$ |
61,563 |
|
$ |
88,399 |
|
(30.4) % |
|
$ |
194,623 |
|
$ |
207,673 |
|
(6.3)% |
| Adjusted EBITDA(a) |
$ |
87,916 |
|
$ |
105,898 |
|
(17.0) % |
|
$ |
267,916 |
|
$ |
296,358 |
|
(9.6)% |
| Adjusted operating income(a) |
$ |
66,290 |
|
$ |
85,896 |
|
(22.8) % |
|
$ |
200,334 |
|
$ |
238,085 |
|
(15.9)% |
| Adjusted net income(a) |
$ |
46,140 |
|
$ |
63,126 |
|
(26.9) % |
|
$ |
142,142 |
|
$ |
163,882 |
|
(13.3)% |
| Adjusted EPS(a) |
$ |
1.34 |
|
$ |
1.79 |
|
(25.1) % |
|
$ |
4.14 |
|
$ |
4.64 |
|
(10.8)% |
| (a) |
EBITDA, adjusted EBITDA, Adjusted operating income, Adjusted net income, and Adjusted EPS are non-GAAP financial measures. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures. Refer to Tables A, B and C at the end of this release for reconciliations of adjusted amounts to the closest corresponding GAAP financial measures. |
Summary Product Line Results
(dollars in thousands)
|
| |
|
| |
Three Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
QTD
Change |
|
Organic
Change(a) |
| Product Line Sales |
|
|
|
|
|
|
|
| Cardio & Vascular |
$ |
263,076 |
|
$ |
277,149 |
|
(5.1)% |
|
(5.1)% |
| Cardiac Rhythm Management & Neuromodulation |
|
175,835 |
|
|
169,156 |
|
3.9% |
|
3.9% |
| Other Markets |
|
10,750 |
|
|
21,386 |
|
(49.7)% |
|
(21.4)% |
| Total Sales |
$ |
449,661 |
|
$ |
467,691 |
|
(3.9)% |
|
(2.2)% |
| |
|
|
|
|
|
|
|
| |
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
YTD
Change |
|
Organic
Change(a) |
| Product Line Sales |
|
|
|
|
|
|
|
| Cardio & Vascular |
$ |
805,117 |
|
$ |
822,875 |
|
(2.2) % |
|
(2.7) % |
| Cardiac Rhythm Management & Neuromodulation |
|
517,811 |
|
|
501,499 |
|
3.3% |
|
3.3% |
| Other Markets |
|
30,423 |
|
|
57,203 |
|
(46.8) % |
|
(15.9) % |
| Total Sales |
$ |
1,353,351 |
|
$ |
1,381,577 |
|
(2.0) % |
|
(0.8) % |
| (a) |
Organic sales change is a non-GAAP financial measure. Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures and refer to Table D at the end of this release for a reconciliation of these amounts to the closest corresponding GAAP financial measures. |
About Integer®
Integer Holdings Corporation (NYSE: ITGR) is one of the largest medical device contract development and manufacturing organizations (CDMOs) in the world, serving the cardio and vascular, neuromodulation, and cardiac rhythm management markets. As a strategic partner of choice, we advance the goals of our medical device customers through industry-leading engineering and manufacturing, with a relentless commitment to quality, service, and innovation. The company’s brands include Greatbatch Medical® and Lake Region Medical®. Additional information is available at www.integer.net.
Investor Relations:
Kristen Stewart
551-337-3973
kristen.stewart@integer.net
Notes Regarding Non-GAAP Financial Information
In addition to our results reported in accordance with generally accepted accounting principles in the United States of America (“GAAP”), we provide adjusted net income, adjusted EPS, earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA, adjusted operating income, and organic sales change. Unless otherwise indicated, all financial metrics presented reflect continuing operations only.
Adjusted net income and adjusted EPS consist of GAAP income (loss) from continuing operations and diluted EPS from continuing operations, respectively, adjusted for the following to the extent occurring during the period: (i) amortization of intangible assets, (ii) certain legal expenses; (iii) restructuring and restructuring-related charges; (iv) acquisition and integration costs; (v) other general expenses; (vi) ERP implementation, (vii) (gain) loss on equity investments; (viii) extinguishment of debt charges, (ix) debt conversion inducement expense; (x) European Union medical device regulation incremental charges; (xi) inventory step-up amortization; (xii) unusual, or infrequently occurring items; (xiii) the income tax provision (benefit) related to these adjustments and (xiv) certain tax items that are outside the normal tax provision for the period. Adjusted EPS is calculated by dividing adjusted net income by adjusted weighted average shares.
The weighted average shares used to calculate diluted EPS in accordance with GAAP includes dilution, when applicable, resulting from the potential conversion of our 2028 Convertible Notes and 2030 Convertible Notes (collectively, the “Convertible Notes”). In connection with the issuance of the Convertible Notes, we entered into capped call contracts which are expected to reduce the potential dilution on our common stock in connection with any conversion of the Convertible Notes, subject to a cap. Adjusted weighted average shares consists of GAAP weighted average shares used to calculate diluted EPS, including, when applicable, dilutive common stock equivalents that were excluded from weighted average shares used to calculate diluted EPS as their inclusion would be anti-dilutive and excluding, when applicable, dilution resulting from the potential conversion of our Convertible Notes expected to be offset by the capped call contracts.
EBITDA is calculated by adding back interest expense, provision for income taxes, depreciation expense, and amortization expense from intangible assets and financing leases, to income (loss) from continuing operations, which is the most directly comparable GAAP financial measure. Adjusted EBITDA consists of EBITDA plus adding back stock-based compensation and the same adjustments as listed above except for items (i), (viii), (xiii) and (xiv). Adjusted operating income consists of operating income adjusted for the same items listed above except for items (vii), (viii), (ix), (xiii) and (xiv).
Organic sales change is reported sales growth adjusted to remove the impact of foreign currency, the contribution of acquisitions and the strategic exit of the Portable Medical market. To calculate the impact of foreign currency on sales growth rates, we convert any sale made in a foreign currency by converting current period sales into prior period sales using the exchange rate in effect at that time and then compare the two, negating any effect foreign currency had on our transactional revenue. For contribution of acquisitions, we exclude the impact on the growth rate attributable to the contribution of acquisitions in all periods where there were no comparable sales. For the strategic exit of the Portable Medical market, we exclude the impact on the growth rate attributable to Portable Medical sales for all periods presented.
We believe that the presentation of adjusted net income, adjusted EPS, EBITDA, adjusted EBITDA, adjusted operating income, and organic sales change, provides important supplemental information to management and investors seeking to understand the financial and business trends relating to our financial condition and results of operations. In addition to the performance measures identified above, we believe that net total debt and leverage ratio provide meaningful measures of liquidity and a useful basis for assessing our ability to fund our activities, including the financing of acquisitions and debt repayments. Net total debt is calculated as total principal amount of debt outstanding less cash and cash equivalents. We calculate leverage ratio as net total debt divided by adjusted EBITDA for the trailing 4 quarters.
Cautionary Statement Regarding Forward-Looking Statements
Some of the statements contained in this communication and other written and oral statements made from time to time by us and our representatives are not statements of historical or current fact. As such, they are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations, and these statements are subject to known and unknown risks, uncertainties and assumptions. Forward-looking statements include, but are not limited to, statements relating to: the completion of the Transaction on anticipated terms and timing, or at all, including obtaining regulatory approvals and satisfying other conditions to the completion of the Transaction; potential litigation relating to the Transaction that has been or could be instituted against the parties to the Merger Agreement, or their respective directors, managers, or officers, including the effects of any outcomes related thereto; our goals, plans, and strategic initiatives; long-term growth prospects; maximizing value for our stockholders; other events, conditions or developments that will or may occur in the future; and the timing of any of the foregoing. You can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “forecast,” “outlook,” “assume,” “potential” or “continue” or variations or the negative counterparts of these terms or other comparable terminology. These statements are only predictions and are not guarantees of future performance, and investors should not place undue reliance on forward-looking statements as predictive of future results. Actual events or results may differ materially from those stated or implied by these forward-looking statements. In evaluating these statements and our prospects, you should carefully consider the factors set forth below. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary factors and by others contained throughout this communication.
Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements regarding the Transaction. All such forward-looking statements are based upon current plans, estimates, expectations, opportunities and ambitions that are subject to risks, uncertainties, assumptions, and other important factors, many of which are beyond the control of the Company, that could cause actual results to differ materially from those expressed in such forward-looking statements. Key factors that could cause actual results to differ materially include, but are not limited to, the expected timing and likelihood of completion of the Transaction, including the timing, receipt and terms and conditions of any required governmental and regulatory approvals; the occurrence of any event, change or other circumstances that could give rise to the termination of the Transaction; the risk that the parties may not be able to satisfy the conditions to the Transaction in a timely manner or at all; risks related to disruption of management time from ongoing business operations due to the Transaction; the risk that any announcements relating to the Transaction could have adverse effects on the market price of the Company’s common stock; the risk that the Transaction and its announcement could have an adverse effect on the parties’ business relationships and business generally, including the ability of the Company to retain customers and retain and hire key personnel and maintain relationships with their suppliers and customers, and on their operating results and businesses generally; the risk of unforeseen or unknown liabilities; customer, regulatory and other stakeholder approvals and support; the risk of unexpected future capital expenditures; the risk of potential litigation relating to the Transaction that has been or could be instituted against the Company or its directors and/or officers; the risk associated with third-party contracts containing material consent, anti-assignment, transfer or other provisions that may be related to the Transaction which are not waived or otherwise satisfactorily resolved; significant costs, or expenses incurred in connection with the Transaction; Parent’s ability to obtain the necessary financing arrangements set forth in the commitment letters received in connection with the Transaction; certain restrictions contained in the Merger Agreement that may impact the Company’s ability to pursue certain business opportunities or strategic transactions; the risk of various events that could disrupt operations, including pandemics, epidemics or other public health crises or severe weather (such as droughts, floods, avalanches and earthquakes), cybersecurity attacks, security threats and governmental response to them, and technological changes; the risks of labor disputes, changes in labor costs and labor difficulties; and the risks resulting from other effects of industry, market, economic, legal or legislative, political or regulatory conditions outside of the Company’s control. All such factors are difficult to predict and are beyond our control, including those detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which was filed with the Securities and Exchange Commission (the “SEC”) on February 23, 2026, the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended July 3, 2026, which was filed with the SEC on August 4, 2026, the Company’s definitive proxy statement filed with the SEC on September 14, 2026, as supplemented, and other documents subsequently filed by the Company with the SEC. The Company’s forward-looking statements are based on assumptions that the Company believes to be reasonable but that may not prove to be accurate. Other unpredictable factors not discussed in this communication could also have material adverse effects on forward-looking statements. The Company does not assume an obligation to update any forward-looking statements, except as required by applicable law. These forward-looking statements speak only as of the date hereof.
| Condensed Consolidated Balance Sheets – Unaudited |
| (in thousands) |
| |
October 2,
2026 |
|
December 31,
2025 |
| ASSETS |
|
|
|
| Current assets: |
|
|
|
| Cash and cash equivalents |
$ |
14,135 |
|
|
$ |
17,161 |
|
| Accounts receivable, net |
|
345,072 |
|
|
|
346,079 |
|
| Inventories |
|
278,591 |
|
|
|
253,739 |
|
| Contract assets |
|
119,297 |
|
|
|
112,546 |
|
| Prepaid expenses and other current assets |
|
44,297 |
|
|
|
40,572 |
|
| Total current assets |
|
801,392 |
|
|
|
770,097 |
|
| Property, plant and equipment, net |
|
535,133 |
|
|
|
536,427 |
|
| Goodwill |
|
1,100,799 |
|
|
|
1,110,908 |
|
| Other intangible assets, net |
|
770,089 |
|
|
|
825,435 |
|
| Deferred income taxes |
|
8,938 |
|
|
|
8,994 |
|
| Operating lease assets |
|
82,586 |
|
|
|
98,437 |
|
| Financing lease assets |
|
55,491 |
|
|
|
37,109 |
|
| Other long-term assets |
|
39,509 |
|
|
|
23,170 |
|
| Total assets |
$ |
3,393,937 |
|
|
$ |
3,410,577 |
|
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
| Current liabilities: |
|
|
|
| Accounts payable |
$ |
111,003 |
|
|
$ |
113,130 |
|
| Operating lease liabilities |
|
8,359 |
|
|
|
9,099 |
|
| Accrued expenses and other current liabilities |
|
81,763 |
|
|
|
109,812 |
|
| Total current liabilities |
|
201,125 |
|
|
|
232,041 |
|
| Long-term debt |
|
1,219,247 |
|
|
|
1,185,179 |
|
| Deferred income taxes |
|
113,596 |
|
|
|
116,327 |
|
| Operating lease liabilities |
|
67,371 |
|
|
|
81,899 |
|
| Financing lease liabilities |
|
49,577 |
|
|
|
28,578 |
|
| Other long-term liabilities |
|
16,622 |
|
|
|
19,910 |
|
| Total liabilities |
|
1,667,538 |
|
|
|
1,663,934 |
|
| Stockholders’ equity: |
|
|
|
| Common stock |
|
35 |
|
|
|
35 |
|
| Additional paid-in capital |
|
761,271 |
|
|
|
771,223 |
|
| Treasury stock |
|
(110,334 |
) |
|
|
(76,872 |
) |
| Retained earnings |
|
1,049,144 |
|
|
|
994,055 |
|
| Accumulated other comprehensive income |
|
26,283 |
|
|
|
58,202 |
|
| Total stockholders’ equity |
|
1,726,399 |
|
|
|
1,746,643 |
|
| Total liabilities and stockholders’ equity |
$ |
3,393,937 |
|
|
$ |
3,410,577 |
|
| Condensed Consolidated Statements of Operations – Unaudited |
|
|
|
|
| (in thousands, except per share data) |
|
|
|
|
| |
Three Months Ended |
|
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
October 2,
2026 |
|
September 26,
2025 |
| Sales |
$ |
449,661 |
|
|
$ |
467,691 |
|
|
$ |
1,353,351 |
|
$ |
1,381,577 |
|
| Cost of sales |
|
348,100 |
|
|
|
341,531 |
|
|
|
1,029,253 |
|
|
1,005,947 |
|
| Gross profit |
|
101,561 |
|
|
|
126,160 |
|
|
|
324,098 |
|
|
375,630 |
|
| Operating expenses: |
|
|
|
|
|
|
|
| Selling, general and administrative |
|
54,147 |
|
|
|
50,451 |
|
|
|
170,557 |
|
|
154,534 |
|
| Research, development and engineering |
|
13,528 |
|
|
|
10,949 |
|
|
|
41,049 |
|
|
39,390 |
|
| Restructuring and other charges |
|
5,677 |
|
|
|
8,321 |
|
|
|
17,886 |
|
|
16,377 |
|
| Total operating expenses |
|
73,352 |
|
|
|
69,721 |
|
|
|
229,492 |
|
|
210,301 |
|
| Operating income |
|
28,209 |
|
|
|
56,439 |
|
|
|
94,606 |
|
|
165,329 |
|
| Interest expense |
|
9,701 |
|
|
|
9,367 |
|
|
|
29,570 |
|
|
33,926 |
|
| (Gain) loss on equity investments |
|
(31 |
) |
|
|
(50 |
) |
|
|
1,395 |
|
|
(223 |
) |
| Other loss, net |
|
1,027 |
|
|
|
1,130 |
|
|
|
2,487 |
|
|
53,037 |
|
| Income from continuing operations before taxes |
|
17,512 |
|
|
|
45,992 |
|
|
|
61,154 |
|
|
78,589 |
|
| Provision (benefit) for income taxes |
|
2,534 |
|
|
|
6,314 |
|
|
|
6,065 |
|
|
24,367 |
|
| Income from continuing operations |
|
14,978 |
|
|
|
39,678 |
|
|
|
55,089 |
|
|
54,222 |
|
| Loss from discontinued operations, net of tax |
|
— |
|
|
|
— |
|
|
|
— |
|
|
(22 |
) |
| Net income |
$ |
14,978 |
|
|
$ |
39,678 |
|
|
$ |
55,089 |
|
$ |
54,200 |
|
| |
|
|
|
|
|
|
|
| Basic earnings per share: |
|
|
|
|
|
|
|
| Income from continuing operations |
$ |
0.44 |
|
|
$ |
1.13 |
|
|
$ |
1.62 |
|
$ |
1.56 |
|
| Loss from discontinued operations |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
$ |
— |
|
| Basic earnings per share |
$ |
0.44 |
|
|
$ |
1.13 |
|
|
$ |
1.62 |
|
$ |
1.56 |
|
| |
|
|
|
|
|
|
|
| Diluted earnings per share: |
|
|
|
|
|
|
|
| Income from continuing operations |
$ |
0.43 |
|
|
$ |
1.11 |
|
|
$ |
1.60 |
|
$ |
1.52 |
|
| Loss from discontinued operations |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
$ |
— |
|
| Diluted earnings per share |
$ |
0.43 |
|
|
$ |
1.11 |
|
|
$ |
1.60 |
|
$ |
1.52 |
|
| |
|
|
|
|
|
|
|
| Weighted average shares outstanding: |
|
|
|
|
|
|
|
| Basic |
|
34,027 |
|
|
|
35,081 |
|
|
|
34,106 |
|
|
34,689 |
|
| Diluted |
|
34,604 |
|
|
|
35,608 |
|
|
|
34,394 |
|
|
35,755 |
|
| Condensed Consolidated Statements of Cash Flows – Unaudited |
| (in thousands) |
| |
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
| Cash flows from operating activities: |
|
|
|
| Net income |
$ |
55,089 |
|
|
$ |
54,200 |
|
| Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
| Depreciation and amortization |
|
103,899 |
|
|
|
95,158 |
|
| Debt related charges included in interest expense |
|
4,910 |
|
|
|
5,239 |
|
| Debt conversion inducement expense |
|
— |
|
|
|
46,681 |
|
| Stock-based compensation |
|
17,273 |
|
|
|
17,467 |
|
| Non-cash fixed asset impairment |
|
7,141 |
|
|
|
— |
|
| Non-cash lease expense |
|
7,283 |
|
|
|
7,583 |
|
| Non-cash (gains) losses on equity investments |
|
1,395 |
|
|
|
(223 |
) |
| Contingent consideration fair value adjustment |
|
(1,179 |
) |
|
|
(660 |
) |
| Other non-cash losses |
|
4,043 |
|
|
|
804 |
|
| Deferred income taxes |
|
17 |
|
|
|
4,082 |
|
| Gain on sale of discontinued operations |
|
— |
|
|
|
(46 |
) |
| Changes in operating assets and liabilities, net of acquisitions: |
|
|
|
| Accounts receivable |
|
(98 |
) |
|
|
(46,793 |
) |
| Inventories |
|
(28,474 |
) |
|
|
(12,241 |
) |
| Prepaid expenses and other assets |
|
(4,110 |
) |
|
|
117 |
|
| Contract assets |
|
(7,255 |
) |
|
|
(2,106 |
) |
| Accounts payable |
|
2,137 |
|
|
|
3,187 |
|
| Accrued expenses and other liabilities |
|
(29,421 |
) |
|
|
(22,359 |
) |
| Income taxes payable |
|
(11,589 |
) |
|
|
(9,357 |
) |
| Net cash provided by operating activities |
|
121,061 |
|
|
|
140,733 |
|
| Cash flows from investing activities: |
|
|
|
| Acquisition of property, plant and equipment |
|
(67,181 |
) |
|
|
(63,555 |
) |
| Purchase of equity and other investments |
|
(14,043 |
) |
|
|
— |
|
| Acquisitions, net |
|
— |
|
|
|
(170,872 |
) |
| Other investing activities |
|
126 |
|
|
|
(835 |
) |
| Net cash used in investing activities |
|
(81,098 |
) |
|
|
(235,262 |
) |
| Cash flows from financing activities: |
|
|
|
| Principal payments of long-term debt |
|
— |
|
|
|
(657,697 |
) |
| Proceeds from issuance of convertible notes, net of discount |
|
— |
|
|
|
977,500 |
|
| Proceeds from revolving credit facility |
|
221,000 |
|
|
|
301,000 |
|
| Payments of revolving credit facility |
|
(191,000 |
) |
|
|
(427,000 |
) |
| Purchase of capped calls |
|
— |
|
|
|
(71,000 |
) |
| Payment of debt issuance costs |
|
(38 |
) |
|
|
(1,386 |
) |
| Proceeds from the exercise of stock options |
|
— |
|
|
|
3,644 |
|
| Tax withholdings related to net share settlements of restricted stock unit awards |
|
(10,419 |
) |
|
|
(16,812 |
) |
| Repurchases of common stock |
|
(50,000 |
) |
|
|
— |
|
| Principal payments on finance leases |
|
(6,558 |
) |
|
|
(4,165 |
) |
| Other financing activities |
|
(5,163 |
) |
|
|
1,194 |
|
| Net cash provided by (used in) financing activities |
|
(42,178 |
) |
|
|
105,278 |
|
| Effect of foreign currency exchange rates on cash and cash equivalents |
|
(811 |
) |
|
|
1,652 |
|
| Net increase (decrease) in cash and cash equivalents |
|
(3,026 |
) |
|
|
12,401 |
|
| Cash and cash equivalents, beginning of period |
|
17,161 |
|
|
|
46,543 |
|
| Cash and cash equivalents, end of period |
$ |
14,135 |
|
|
$ |
58,944 |
|
Table A: Adjusted Net Income and Diluted EPS from Continuing Operations Reconciliations
(in thousands, except per share amounts)
|
| |
|
| |
Three Months Ended |
| |
October 2, 2026 |
|
September 26, 2025 |
| |
Pre-Tax |
|
Net of
Tax |
|
Per
Diluted
Share(a) |
|
Pre-Tax |
|
Net of
Tax |
|
Per
Diluted
Share(a) |
| Income from continuing operations (GAAP) |
$ |
17,512 |
|
|
$ |
14,978 |
|
|
$ |
0.43 |
|
$ |
45,992 |
|
|
$ |
39,678 |
|
|
$ |
1.11 |
| Adjustments(b): |
|
|
|
|
|
|
|
|
|
|
|
| Amortization of intangible assets |
|
15,749 |
|
|
|
12,718 |
|
|
|
0.37 |
|
|
16,249 |
|
|
|
13,088 |
|
|
|
0.37 |
| Certain legal expenses (SG&A)(c) |
|
828 |
|
|
|
655 |
|
|
|
0.02 |
|
|
181 |
|
|
|
144 |
|
|
|
— |
| Restructuring and restructuring-related charges(d) |
|
4,666 |
|
|
|
3,720 |
|
|
|
0.11 |
|
|
2,749 |
|
|
|
2,196 |
|
|
|
0.06 |
| Acquisition and integration costs(e) |
|
102 |
|
|
|
82 |
|
|
|
— |
|
|
1,372 |
|
|
|
1,087 |
|
|
|
0.03 |
| Other general expenses(f) |
|
4,176 |
|
|
|
3,310 |
|
|
|
0.10 |
|
|
6,247 |
|
|
|
4,764 |
|
|
|
0.13 |
| ERP implementation(g) |
|
3,947 |
|
|
|
3,119 |
|
|
|
0.09 |
|
|
— |
|
|
|
— |
|
|
|
— |
| (Gain) loss on equity investments(h) |
|
(31 |
) |
|
|
(24 |
) |
|
|
— |
|
|
(50 |
) |
|
|
(39 |
) |
|
|
— |
| Medical device regulations(i) |
|
45 |
|
|
|
35 |
|
|
|
— |
|
|
183 |
|
|
|
145 |
|
|
|
— |
| Other adjustments(j) |
|
8,568 |
|
|
|
6,768 |
|
|
|
0.20 |
|
|
2,476 |
|
|
|
1,956 |
|
|
|
0.06 |
| Tax adjustments(k) |
|
— |
|
|
|
779 |
|
|
|
0.02 |
|
|
— |
|
|
|
107 |
|
|
|
— |
| Adjusted net income (non-GAAP) |
$ |
55,562 |
|
|
$ |
46,140 |
|
|
$ |
1.34 |
|
$ |
75,399 |
|
|
$ |
63,126 |
|
|
$ |
1.79 |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Nine Months Ended |
| |
October 2, 2026 |
|
September 26, 2025 |
| |
Pre-Tax |
|
Net of
Tax |
|
Per
Diluted
Share(a) |
|
Pre-Tax |
|
Net of
Tax |
|
Per
Diluted
Share(a) |
| Income from continuing operations (GAAP) |
$ |
61,154 |
|
|
$ |
55,089 |
|
|
$ |
1.60 |
|
$ |
78,589 |
|
|
$ |
54,222 |
|
|
$ |
1.52 |
| Adjustments(b): |
|
|
|
|
|
|
|
|
|
|
|
| Amortization of intangible assets |
|
47,716 |
|
|
|
38,538 |
|
|
|
1.12 |
|
|
47,220 |
|
|
|
38,015 |
|
|
|
1.08 |
| Certain legal expenses (SG&A)(c) |
|
2,967 |
|
|
|
2,344 |
|
|
|
0.07 |
|
|
292 |
|
|
|
231 |
|
|
|
0.01 |
| Restructuring and restructuring-related charges(d) |
|
10,911 |
|
|
|
8,392 |
|
|
|
0.24 |
|
|
6,426 |
|
|
|
5,134 |
|
|
|
0.15 |
| Acquisition and integration costs(e) |
|
1,717 |
|
|
|
1,366 |
|
|
|
0.04 |
|
|
8,121 |
|
|
|
6,434 |
|
|
|
0.18 |
| Other general expenses(f) |
|
12,322 |
|
|
|
10,178 |
|
|
|
0.30 |
|
|
6,253 |
|
|
|
4,770 |
|
|
|
0.14 |
| ERP implementation(g) |
|
12,221 |
|
|
|
9,655 |
|
|
|
0.28 |
|
|
— |
|
|
|
— |
|
|
|
— |
| (Gain) loss on equity investments(h) |
|
1,395 |
|
|
|
1,102 |
|
|
|
0.03 |
|
|
(223 |
) |
|
|
(176 |
) |
|
|
— |
| Loss on extinguishment of debt(l) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
867 |
|
|
|
685 |
|
|
|
0.02 |
| Debt conversion inducement expense(m) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
46,681 |
|
|
|
46,681 |
|
|
|
1.32 |
| Medical device regulations(i) |
|
389 |
|
|
|
307 |
|
|
|
0.01 |
|
|
695 |
|
|
|
549 |
|
|
|
0.02 |
| Other adjustments(j) |
|
17,485 |
|
|
|
13,813 |
|
|
|
0.40 |
|
|
3,749 |
|
|
|
2,962 |
|
|
|
0.08 |
| Tax adjustments(k) |
|
— |
|
|
|
1,358 |
|
|
|
0.04 |
|
|
— |
|
|
|
4,375 |
|
|
|
0.12 |
| Adjusted net income (Non-GAAP) |
$ |
168,277 |
|
|
$ |
142,142 |
|
|
$ |
4.14 |
|
$ |
198,670 |
|
|
$ |
163,882 |
|
|
$ |
4.64 |
| (a) |
Income from continuing operations (GAAP) per diluted share amounts are calculated in accordance with GAAP using weighted average shares for diluted EPS. The per share amounts for the adjustments in the table above and adjusted net income are calculated using adjusted weighted average shares. The following table provides a reconciliation from GAAP weighted average shares for diluted EPS to non-GAAP adjusted weighted average shares. |
| |
Three Months Ended |
|
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
October 2,
2026 |
|
September 26,
2025 |
| Weighted average shares for diluted EPS (GAAP) |
34,604 |
|
|
35,608 |
|
|
34,394 |
|
|
35,755 |
|
| Less: 2028 Convertible Notes capped call options impact |
(244 |
) |
|
(261 |
) |
|
(90 |
) |
|
(430 |
) |
| Adjusted weighted average shares (non-GAAP) |
34,360 |
|
|
35,347 |
|
|
34,304 |
|
|
35,325 |
|
| (b) |
The difference between pre-tax and net of tax amounts is the estimated tax impact related to the respective adjustment. Net of tax amounts are computed using a 21% U.S. tax rate, and the statutory tax rates applicable in foreign tax jurisdictions, as adjusted for the existence of net operating losses (“NOLs”). Expenses that are not deductible for tax purposes (i.e. permanent tax differences) are added back at 100%. |
| (c) |
Certain legal expenses associated with non-ordinary course legal matters. Amounts for the third quarter and first nine months of 2026 include $0.7 million and $2.5 million, respectively, of expense incurred in connection with the Company’s defense of a securities class action lawsuit. |
| (d) |
We initiate discrete restructuring programs primarily to realign resources to better serve our customers and markets, improve operational efficiency and capabilities, and lower operating costs or improve profitability. Depending on the program, restructuring charges may include termination benefits, contract termination, facility closure and other exit and disposal costs. Restructuring-related expenses are directly related to the program and may include retention bonuses, accelerated depreciation, consulting expense and costs to transfer manufacturing operations among our facilities. Amounts for the third quarter and first nine months of 2026 include $2.2 million and $5.0 million, respectively, relating to our global manufacturing alignment restructuring initiative. In addition, the third quarter and first nine months of 2026 includes $0.6 million and $3.0 million, respectively, related to an organizational realignment to enhance execution of our strategy through dedicated focus on growth and operational excellence. |
| (e) |
Acquisition and integration costs are incremental costs that are directly related to a business or asset acquisition. These costs may include, among other things, professional, consulting and other fees, system integration costs, and fair value adjustments relating to contingent consideration. |
| (f) |
Other general expenses are discrete transactions occurring sporadically and affect period-over-period comparisons. The Company recorded fixed asset impairment charges during the third quarter and first nine months of 2026 of $1.2 million and $7.1 million, respectively, which were primarily due to revised expectations regarding the future use of certain fixed assets, and expense of $2.9 million and $4.4 million, respectively, related to termination benefits from actions to align labor with manufacturing volumes. The third quarter and first nine months of 2025 include $6.2 million related to termination benefits from actions to align labor with manufacturing volumes. |
| (g) |
These adjustments represent direct and incremental costs incurred in connection with our implementation of a new global enterprise resource planning (“ERP”) solution and related IT transition costs. An implementation of this scale is a significant undertaking and will require substantial time and attention of management and key employees. The associated costs do not represent normal and recurring operating expenses and will be inconsistent in amounts and frequency making it difficult to contribute to a meaningful evaluation of our operating performance. Expenses for 2026 were primarily included in SG&A. |
| (h) |
Amounts reflect our share of equity method investee (gains) losses including unrealized appreciation/depreciation of the underlying interests of the investee. |
| (i) |
The charges represent incremental costs of complying with European Union medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third-party expenses. |
| (j) |
Other adjustments include costs which impact period-to-period comparability and do not represent the underlying ongoing results of our business. For 2025 and 2026, amounts include costs associated with leadership transitions, strategic projects, a stockholder activist matter, the Company’s strategic review and the Transaction, and a cyber incident. Other adjustments includes the following expenses (in millions): |
| |
Three Months Ended |
|
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
October 2,
2026 |
|
September 26,
2025 |
| Leadership transition costs |
$ |
— |
|
$ |
1.0 |
|
$ |
1.5 |
|
$ |
1.7 |
| Strategic projects |
|
1.8 |
|
|
0.7 |
|
|
2.6 |
|
|
2.1 |
| Stockholder activist matter |
|
0.1 |
|
|
— |
|
|
3.9 |
|
|
— |
| Strategic review and Transaction |
|
6.9 |
|
|
— |
|
|
8.2 |
|
|
— |
| Cyber incident costs |
|
0.5 |
|
|
— |
|
|
1.2 |
|
|
— |
| (k) |
Tax adjustments include changes to uncertain tax benefits and associated interest for all periods presented, and for 2026 also reflect nondeductible transaction costs. In addition, included in the amount for the first nine months of 2025 is the write off of a deferred tax asset for $4.1 million related to a portion of the unamortized original issue discount due to the partial exchange of the 2028 Convertible Notes. |
| (l) |
Loss on extinguishment of debt consists of accelerated write-offs of unamortized deferred debt issuance costs and discounts, which are included in interest expense. |
| (m) |
Debt conversion inducement expense relates to the partial exchange of the 2028 Convertible Notes and is recorded within Other loss, net in the Condensed Consolidated Statements of Operations. |
| |
|
Please see “Notes Regarding Non-GAAP Financial Information” for additional information regarding our use of non-GAAP financial measures.
Table B: Adjusted Operating Income Reconciliations
(in thousands)
|
| |
|
|
|
| |
Three Months Ended |
|
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
October 2,
2026 |
|
September 26,
2025 |
| Operating income (GAAP) |
$ |
28,209 |
|
$ |
56,439 |
|
$ |
94,606 |
|
$ |
165,329 |
| Adjustments: |
|
|
|
|
|
|
|
| Amortization of intangible assets |
|
15,749 |
|
|
16,249 |
|
|
47,716 |
|
|
47,220 |
| Certain legal expenses |
|
828 |
|
|
181 |
|
|
2,967 |
|
|
292 |
| Restructuring and restructuring-related charges |
|
4,666 |
|
|
2,749 |
|
|
10,911 |
|
|
6,426 |
| Acquisition and integration costs |
|
102 |
|
|
1,372 |
|
|
1,717 |
|
|
8,121 |
| Other general expenses |
|
4,176 |
|
|
6,247 |
|
|
12,322 |
|
|
6,253 |
| ERP implementation |
|
3,947 |
|
|
— |
|
|
12,221 |
|
|
— |
| Medical device regulations |
|
45 |
|
|
183 |
|
|
389 |
|
|
695 |
| Other adjustments |
|
8,568 |
|
|
2,476 |
|
|
17,485 |
|
|
3,749 |
| Adjusted operating income (non-GAAP) |
$ |
66,290 |
|
$ |
85,896 |
|
$ |
200,334 |
|
$ |
238,085 |
Table C: EBITDA and Adjusted EBITDA Reconciliations
(in thousands)
|
| |
|
|
|
| |
Three Months Ended |
|
Nine Months Ended |
| |
October 2,
2026 |
|
September 26,
2025 |
|
October 2,
2026 |
|
September 26,
2025 |
| Income from continuing operations (GAAP) |
$ |
14,978 |
|
|
$ |
39,678 |
|
|
$ |
55,089 |
|
$ |
54,222 |
|
| |
|
|
|
|
|
|
|
| Interest expense |
|
9,701 |
|
|
|
9,367 |
|
|
|
29,570 |
|
|
33,926 |
|
| Provision (benefit) for income taxes |
|
2,534 |
|
|
|
6,314 |
|
|
|
6,065 |
|
|
24,367 |
|
| Depreciation(a) |
|
16,697 |
|
|
|
15,562 |
|
|
|
50,783 |
|
|
44,588 |
|
| Amortization of intangible assets and financing leases |
|
17,653 |
|
|
|
17,478 |
|
|
|
53,116 |
|
|
50,570 |
|
| EBITDA (non-GAAP) |
|
61,563 |
|
|
|
88,399 |
|
|
|
194,623 |
|
|
207,673 |
|
| Stock-based compensation(b) |
|
4,052 |
|
|
|
4,341 |
|
|
|
13,886 |
|
|
16,691 |
|
| Certain legal expenses |
|
828 |
|
|
|
181 |
|
|
|
2,967 |
|
|
292 |
|
| Restructuring and restructuring-related charges |
|
4,666 |
|
|
|
2,749 |
|
|
|
10,911 |
|
|
6,426 |
|
| Acquisition and integration costs |
|
102 |
|
|
|
1,372 |
|
|
|
1,717 |
|
|
8,121 |
|
| Other general expenses |
|
4,176 |
|
|
|
6,247 |
|
|
|
12,322 |
|
|
6,253 |
|
| ERP implementation |
|
3,947 |
|
|
|
— |
|
|
|
12,221 |
|
|
— |
|
| (Gain) loss on equity investments |
|
(31 |
) |
|
|
(50 |
) |
|
|
1,395 |
|
|
(223 |
) |
| Debt conversion inducement expense |
|
— |
|
|
|
— |
|
|
|
— |
|
|
46,681 |
|
| Medical device regulations |
|
45 |
|
|
|
183 |
|
|
|
389 |
|
|
695 |
|
| Other adjustments |
|
8,568 |
|
|
|
2,476 |
|
|
|
17,485 |
|
|
3,749 |
|
| Adjusted EBITDA (non-GAAP) |
$ |
87,916 |
|
|
$ |
105,898 |
|
|
$ |
267,916 |
|
$ |
296,358 |
|
| (a) |
Excludes amounts included in Restructuring and restructuring-related charges. |
| (b) |
Total stock-based compensation expense less amounts included in Restructuring and restructuring-related charges, ERP implementation, and Other adjustments. |
| Table D: Organic Sales Change Reconciliation (% Change) |
| |
|
|
|
|
|
|
|
| |
GAAP
Reported
Growth |
|
Impact of
Foreign
Currency(a) |
|
Impact of
Strategic
Exits and
Acquisitions(a) |
|
Non-GAAP
Organic
Change |
| QTD Change (3Q 2026 vs. 3Q 2025) |
|
|
|
|
|
|
|
| Product Line |
|
|
|
|
|
|
|
| Cardio & Vascular |
(5.1)% |
|
(0.1)% |
|
0.1% |
|
(5.1)% |
| Cardiac Rhythm Management & Neuromodulation |
3.9% |
|
—% |
|
—% |
|
3.9% |
| Other Markets |
(49.7)% |
|
—% |
|
(28.3)% |
|
(21.4)% |
| Total Sales |
(3.9)% |
|
—% |
|
(1.7)% |
|
(2.2)% |
| |
|
|
|
|
|
|
|
| YTD Change (9M 2026 vs. 9M 2025) |
|
|
|
|
|
|
|
| Product Line |
|
|
|
|
|
|
|
| Cardio & Vascular |
(2.2)% |
|
0.2% |
|
0.3% |
|
(2.7)% |
| Cardiac Rhythm Management & Neuromodulation |
3.3% |
|
—% |
|
—% |
|
3.3% |
| Other Markets |
(46.8)% |
|
—% |
|
(30.9)% |
|
(15.9)% |
| Total Sales |
(2.0)% |
|
0.1% |
|
(1.3)% |
|
(0.8)% |
| (a) |
Sales growth has been adjusted to exclude the impact of foreign currency exchange rate fluctuations, when applicable, and strategic exits and acquisitions. |
Table E: Net Total Debt Reconciliation
(in thousands)
|
| |
|
|
|
| |
October 2,
2026 |
|
December 31,
2025 |
| Total debt |
$ |
1,219,247 |
|
$ |
1,185,179 |
| Add: Debt discounts and deferred issuance costs included in Total debt |
|
18,037 |
|
|
22,105 |
| Total principal amount of debt outstanding |
|
1,237,284 |
|
|
1,207,284 |
| Less: Cash and cash equivalents |
|
14,135 |
|
|
17,161 |
| Net Total Debt (Non-GAAP) |
$ |
1,223,149 |
|
$ |
1,190,123 |
