Merit Medical Reports First Quarter 2025 Results and Updates Full-Year Guidance
Merit Medical Systems (MMSI) reported strong Q1 2025 financial results with revenue reaching $355.4 million, up 9.8% year-over-year. The company demonstrated solid performance with constant currency revenue growth of 10.9% and organic growth of 6.0%.
Key financial metrics include GAAP operating margin of 11.5% (up from 11.1%), non-GAAP operating margin of 19.3% (up from 17.0%), and GAAP EPS of $0.49 (up 2.0%). Non-GAAP EPS increased 14.8% to $0.86.
The company maintained its 2025 revenue guidance of $1.470-$1.490 billion but updated its non-GAAP EPS guidance to $3.29-$3.42, reflecting strong Q1 results offset by impacts from recent trade policies. As of March 31, 2025, Merit had cash and cash equivalents of $395.5 million and total debt of $747.5 million.
Merit Medical Systems (MMSI) ha riportato risultati finanziari solidi nel primo trimestre 2025 con ricavi pari a 355,4 milioni di dollari, in crescita del 9,8% su base annua. L'azienda ha mostrato una performance robusta con una crescita dei ricavi a valuta costante del 10,9% e una crescita organica del 6,0%.
I principali indicatori finanziari includono un margine operativo GAAP dell'11,5% (in aumento dall'11,1%), un margine operativo non-GAAP del 19,3% (in crescita dal 17,0%) e un utile per azione GAAP di 0,49 dollari (in aumento del 2,0%). L'utile per azione non-GAAP è cresciuto del 14,8%, raggiungendo 0,86 dollari.
L'azienda ha confermato le previsioni di ricavi per il 2025 tra 1,470 e 1,490 miliardi di dollari, aggiornando però le stime sull'utile per azione non-GAAP a 3,29-3,42 dollari, riflettendo i forti risultati del primo trimestre bilanciati dagli effetti delle recenti politiche commerciali. Al 31 marzo 2025, Merit disponeva di liquidità e equivalenti per 395,5 milioni di dollari e un debito totale di 747,5 milioni di dollari.
Merit Medical Systems (MMSI) reportó sólidos resultados financieros en el primer trimestre de 2025 con ingresos que alcanzaron los 355,4 millones de dólares, un aumento del 9,8% interanual. La compañía mostró un desempeño sólido con un crecimiento de ingresos a moneda constante del 10,9% y un crecimiento orgánico del 6,0%.
Las métricas financieras clave incluyen un margen operativo GAAP del 11,5% (subiendo desde 11,1%), un margen operativo non-GAAP del 19,3% (incrementado desde 17,0%) y un EPS GAAP de 0,49 dólares (subiendo un 2,0%). El EPS non-GAAP aumentó un 14,8%, llegando a 0,86 dólares.
La empresa mantuvo su guía de ingresos para 2025 entre 1.470 y 1.490 millones de dólares, pero actualizó su previsión de EPS non-GAAP a 3,29-3,42 dólares, reflejando los fuertes resultados del primer trimestre compensados por el impacto de recientes políticas comerciales. Al 31 de marzo de 2025, Merit contaba con efectivo y equivalentes por 395,5 millones de dólares y una deuda total de 747,5 millones de dólares.
Merit Medical Systems (MMSI)는 2025년 1분기 강력한 재무 실적을 보고했으며, 매출은 3억 5,540만 달러로 전년 동기 대비 9.8% 증가했습니다. 회사는 환율 변동을 고려한 매출 성장률 10.9%와 유기적 성장률 6.0%를 기록하며 견조한 성과를 보였습니다.
주요 재무 지표로는 GAAP 영업이익률이 11.5%(이전 11.1% 대비 상승), 비-GAAP 영업이익률이 19.3%(이전 17.0% 대비 상승), GAAP 주당순이익(EPS)은 0.49달러로 2.0% 증가했습니다. 비-GAAP 주당순이익은 14.8% 증가한 0.86달러를 기록했습니다.
회사는 2025년 매출 가이던스를 14억 7천만 달러에서 14억 9천만 달러로 유지했으나, 최근 무역 정책 영향으로 인해 1분기 강력한 실적을 반영해 비-GAAP 주당순이익 가이던스를 3.29달러에서 3.42달러로 상향 조정했습니다. 2025년 3월 31일 기준 Merit는 현금 및 현금성 자산 3억 9,550만 달러와 총 부채 7억 4,750만 달러를 보유하고 있습니다.
Merit Medical Systems (MMSI) a annoncé de solides résultats financiers pour le premier trimestre 2025, avec un chiffre d'affaires atteignant 355,4 millions de dollars, en hausse de 9,8 % sur un an. L'entreprise a démontré une performance robuste avec une croissance du chiffre d'affaires à taux de change constants de 10,9 % et une croissance organique de 6,0 %.
Les principaux indicateurs financiers incluent une marge opérationnelle GAAP de 11,5 % (en hausse par rapport à 11,1 %), une marge opérationnelle non-GAAP de 19,3 % (en hausse par rapport à 17,0 %) et un BPA GAAP de 0,49 $ (en hausse de 2,0 %). Le BPA non-GAAP a augmenté de 14,8 % pour atteindre 0,86 $.
L'entreprise a maintenu ses prévisions de chiffre d'affaires pour 2025 entre 1,470 et 1,490 milliard de dollars, tout en ajustant ses prévisions de BPA non-GAAP à 3,29-3,42 $, reflétant les solides résultats du premier trimestre compensés par les impacts des récentes politiques commerciales. Au 31 mars 2025, Merit disposait de trésorerie et équivalents de trésorerie de 395,5 millions de dollars et d'une dette totale de 747,5 millions de dollars.
Merit Medical Systems (MMSI) meldete starke Finanzergebnisse für das erste Quartal 2025 mit einem Umsatz von 355,4 Millionen US-Dollar, was einem Anstieg von 9,8 % im Jahresvergleich entspricht. Das Unternehmen zeigte eine solide Leistung mit einem Umsatzwachstum bei konstanten Wechselkursen von 10,9 % und einem organischen Wachstum von 6,0 %.
Wichtige Finanzkennzahlen umfassen eine GAAP-Betriebsmarge von 11,5 % (vorher 11,1 %), eine Non-GAAP-Betriebsmarge von 19,3 % (vorher 17,0 %) und ein GAAP-Gewinn je Aktie (EPS) von 0,49 USD (plus 2,0 %). Das Non-GAAP-EPS stieg um 14,8 % auf 0,86 USD.
Das Unternehmen bestätigte seine Umsatzprognose für 2025 von 1,470 bis 1,490 Milliarden US-Dollar, aktualisierte jedoch seine Non-GAAP-EPS-Prognose auf 3,29 bis 3,42 USD, was die starken Ergebnisse des ersten Quartals widerspiegelt, die durch Auswirkungen jüngster Handelspolitiken ausgeglichen werden. Zum 31. März 2025 verfügte Merit über Barmittel und Zahlungsmitteläquivalente in Höhe von 395,5 Millionen US-Dollar und eine Gesamtverschuldung von 747,5 Millionen US-Dollar.
- Revenue growth of 9.8% to $355.4 million in Q1 2025
- Non-GAAP operating margin improved 229 basis points to 19.3%
- Non-GAAP EPS increased 14.8% to $0.86
- Gross margin improved to 48.4% from 46.9%
- Strong performance in Endoscopy segment with 64.2% growth
- Free cash flow declined 20.5% to $19.5 million
- Lowered non-GAAP EPS guidance due to trade policy impacts
- Custom Procedural Solutions revenue decreased 1.2%
Insights
Merit Medical delivered strong Q1 results but lowered EPS guidance due to trade policy impacts despite maintaining revenue targets.
Merit Medical Systems reported impressive Q1 2025 results that exceeded management's expectations across key metrics. Revenue reached
Looking at segment performance, Endoscopy stood out with
The free cash flow decline of
While Merit maintained its full-year revenue guidance of
Merit's balance sheet remains strong with
First Quarter Highlights†
- Reported revenue of
$355.4 million , up9.8% - Constant currency revenue* and constant currency revenue, organic* up
10.9% and up6.0% , respectively - GAAP operating margin of
11.5% , compared to11.1% in prior year period - Non-GAAP operating margin* of
19.3% , compared to17.0% in prior year period - GAAP EPS
$0.49 , up2.0% - Non-GAAP EPS*
$0.86 , up14.8% - Free cash flow* generation of
$19.5 million , down20.5%
† Comparisons above are calculated for the current quarter compared with the first quarter of 2024, unless otherwise specified. Amounts stated in this release are rounded, while percentages are calculated from the underlying amounts.
* Constant currency revenue; constant currency revenue, organic; non-GAAP gross profit and margin; non-GAAP operating income and margin; non-GAAP net income; non-GAAP EPS; and free cash flow figures (used here and below) are non-GAAP financial measures. A reconciliation of these financial measures to their most directly comparable GAAP financial measures is included under the heading “Non-GAAP Financial Measures” below.
SOUTH JORDAN, Utah, April 24, 2025 (GLOBE NEWSWIRE) -- Merit Medical Systems, Inc. (NASDAQ: MMSI), a leading global manufacturer and marketer of healthcare technology, today announced revenue of
“We delivered better-than-expected financial performance in the first quarter, with our constant currency revenue, organic, our constant currency total revenue and our non-GAAP EPS exceeding the high-end of our expectations,” said Fred P. Lampropoulos, Merit’s Chairman and Chief Executive Officer. “We also delivered impressive year-over-year improvements in our non-GAAP operating margin and our non-GAAP earnings per share, which increased 229 basis points and
Mr. Lampropoulos continued: “We have reaffirmed our 2025 total revenue guidance, which reflects continued confidence in our team’s ability to deliver strong execution and stable constant currency growth this year. We have updated our 2025 non-GAAP earnings per share guidance to reflect our stronger-than-expected first quarter results, offset by the currently projected impact of recently implemented trade policies and related actions by the U.S. and other countries.”
Merit’s revenue by operating segment and product category for the three-month periods ended March 31, 2025 and 2024 was as follows (unaudited; in thousands, except for percentages):
| Three Months Ended | |||||||||||||||||||
| Reported | Constant Currency* | ||||||||||||||||||
| March 31, | Impact of foreign | March 31, | |||||||||||||||||
| 2025 | 2024(1) | % Change | exchange | 2025 | % Change | ||||||||||||||
| Cardiovascular | |||||||||||||||||||
| Peripheral Intervention | $ | 137,279 | $ | 130,066 | 5.5 | % | $ | 1,665 | $ | 138,944 | 6.8 | % | |||||||
| Cardiac Intervention | 99,741 | 90,176 | 10.6 | % | 1,233 | 100,974 | 12.0 | % | |||||||||||
| Custom Procedural Solutions | 47,942 | 48,523 | (1.2 | ) | % | 412 | 48,354 | (0.3 | ) | % | |||||||||
| OEM | 53,751 | 44,609 | 20.5 | % | 71 | 53,822 | 20.7 | % | |||||||||||
| Total | 338,713 | 313,374 | 8.1 | % | 3,381 | 342,094 | 9.2 | % | |||||||||||
| Endoscopy | |||||||||||||||||||
| Endoscopy Devices | 16,638 | 10,134 | 64.2 | % | 24 | 16,662 | 64.4 | % | |||||||||||
| Total | $ | 355,351 | $ | 323,508 | 9.8 | % | $ | 3,405 | $ | 358,756 | 10.9 | % | |||||||
| (1) | Commencing January 1, 2025, we reorganized our sales teams and product categories to include the sale of our spine devices under our OEM product categories. Revenue figures for 2024 have been recast to reflect the realignment of Merit’s portfolio of spine products, representing approximately |
Merit’s GAAP gross margin for the first quarter of 2025 was
Merit’s GAAP net income for the first quarter of 2025 was
As of March 31, 2025, Merit had cash and cash equivalents of
Fiscal Year 2025 Financial Guidance
Based upon the information currently available to Merit’s management, for the year ending December 31, 2025, absent the potential impact of trade policies and related actions implemented by the U.S. and other countries subsequent to today’s date, material acquisitions, non-recurring transactions or other factors beyond Merit’s current expectations, Merit anticipates the following financial results:
Revenue and Earnings Guidance*
| Updated Guidance | Prior Guidance(2) | |||
| Financial Measure | Year Ending | % Change | Year Ending | % Change |
| December 31, 2025 | Y/Y | December 31, 2025 | Y/Y | |
| Net Sales | ||||
| Cardiovascular Segment | ||||
| Endoscopy Segment | ||||
| Non-GAAP | ||||
| Earnings Per Share(1) | ( | |||
*Percentage figures approximated; dollar figures may not foot due to rounding
(1) Merit’s non-GAAP earnings per share reflect the dilutive impact of its
(2) “Prior Guidance” reflects Merit’s full-year 2025 financial guidance, previously introduced on February 25, 2025.
2025 Net Sales Guidance - % Change from Prior Year (Constant Currency) Reconciliation*
| Updated Guidance | Prior Guidance(1) | ||||||
| Low | High | Low | High | ||||
| 2025 Net Sales Guidance - % Change from Prior Year (GAAP) | |||||||
| Estimated impact of foreign currency exchange rate fluctuations | |||||||
| 2025 Net Sales Guidance - % Change from Prior Year (Constant Currency) | |||||||
*Percentage figures approximated and may not foot due to rounding
(1)“Prior Guidance” reflects Merit’s full-year 2025 financial guidance, previously introduced on February 25, 2025.
Merit does not provide guidance for GAAP reported financial measures (other than revenue) or a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP reported financial measures (other than revenue) because Merit is unable to predict with reasonable certainty the financial impact of various items which could impact Merit’s future financial results, such as expenses attributable to acquisitions or other extraordinary transactions, non-cash expenses related to amortization or write-off of previously acquired tangible and intangible assets, certain employee termination benefits, performance-based stock compensation expenses, expenses resulting from non-ordinary course litigation or administrative proceedings and resulting settlements, governmental proceedings, and changes in governmental or industry regulations. These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the guidance period. For the same reasons, Merit is unable to address the significance of the unavailable information, which could be material to future results. Specifically, Merit is not, without unreasonable effort, able to reliably predict the impact of these items and Merit believes inclusion of a reconciliation of these forward-looking non-GAAP measures to their GAAP counterparts could be confusing to investors or cause undue reliance.
Merit’s financial guidance for the year ending December 31, 2025 is subject to risks and uncertainties identified in this release and Merit’s filings with the U.S. Securities and Exchange Commission (the “SEC”). This guidance is based on information and estimates available to Merit as of April 24, 2025. Should known or unknown risks or uncertainties materialize or should underlying assumptions prove inaccurate, actual results will likely vary, and could vary materially, from past results and those anticipated, estimated or projected.
CONFERENCE CALL
Merit will hold its investor conference call today, Thursday, April 24, 2025, at 5:00 p.m., Eastern Time. To access the conference call, please pre-register using the following link. Registrants will receive confirmation with dial-in details. A live webcast and slide deck will also be available at merit.com.
| CONSOLIDATED BALANCE SHEETS | |||||||
| (in thousands) | |||||||
| March 31, | |||||||
| 2025 | December 31, | ||||||
| (Unaudited) | 2024 | ||||||
| ASSETS | |||||||
| Current Assets | |||||||
| Cash and cash equivalents | $ | 395,529 | $ | 376,715 | |||
| Trade receivables, net | 199,550 | 190,243 | |||||
| Other receivables | 17,116 | 16,588 | |||||
| Inventories | 317,936 | 306,063 | |||||
| Prepaid expenses and other assets | 25,007 | 28,544 | |||||
| Prepaid income taxes | 3,417 | 3,286 | |||||
| Income tax refund receivables | 80 | 2,335 | |||||
| Total current assets | 958,635 | 923,774 | |||||
| Property and equipment, net | 390,324 | 386,165 | |||||
| Intangible assets, net | 478,976 | 498,265 | |||||
| Goodwill | 464,360 | 463,511 | |||||
| Deferred income tax assets | 16,100 | 16,044 | |||||
| Operating lease right-of-use assets | 87,722 | 65,508 | |||||
| Other assets | 71,856 | 65,336 | |||||
| Total Assets | $ | 2,467,973 | $ | 2,418,603 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
| Current Liabilities | |||||||
| Trade payables | $ | 63,759 | $ | 68,502 | |||
| Accrued expenses | 118,679 | 134,077 | |||||
| Current operating lease liabilities | 9,435 | 10,331 | |||||
| Income taxes payable | 4,950 | 3,492 | |||||
| Total current liabilities | 196,823 | 216,402 | |||||
| Long-term debt | 730,673 | 729,551 | |||||
| Deferred income tax liabilities | 247 | 240 | |||||
| Liabilities related to unrecognized tax benefits | 2,118 | 2,118 | |||||
| Deferred compensation payable | 18,617 | 19,197 | |||||
| Deferred credits | 1,476 | 1,502 | |||||
| Long-term operating lease liabilities | 77,549 | 54,783 | |||||
| Other long-term obligations | 12,047 | 15,451 | |||||
| Total liabilities | 1,039,550 | 1,039,244 | |||||
| Stockholders' Equity | |||||||
| Common stock | 718,111 | 703,219 | |||||
| Retained earnings | 725,688 | 695,541 | |||||
| Accumulated other comprehensive loss | (15,376 | ) | (19,401 | ) | |||
| Total stockholders' equity | 1,428,423 | 1,379,359 | |||||
| Total Liabilities and Stockholders' Equity | $ | 2,467,973 | $ | 2,418,603 | |||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||
| (Unaudited, in thousands except per share amounts) | |||||||
| Three Months Ended | |||||||
| March 31, | |||||||
| 2025 | 2024 | ||||||
| Net sales | $ | 355,351 | $ | 323,508 | |||
| Cost of sales | 183,331 | 171,793 | |||||
| Gross profit | 172,020 | 151,715 | |||||
| Operating expenses: | |||||||
| Selling, general and administrative | 107,486 | 94,428 | |||||
| Research and development | 22,478 | 21,482 | |||||
| Contingent consideration expense (benefit) | 1,023 | (117 | ) | ||||
| Total operating expenses | 130,987 | 115,793 | |||||
| Income from operations | 41,033 | 35,922 | |||||
| Other income (expense): | |||||||
| Interest income | 3,790 | 7,276 | |||||
| Interest expense | (6,568 | ) | (8,046 | ) | |||
| Other expense — net | (297 | ) | (804 | ) | |||
| Total other expense — net | (3,075 | ) | (1,574 | ) | |||
| Income before income taxes | 37,958 | 34,348 | |||||
| Income tax expense | 7,811 | 6,108 | |||||
| Net income | $ | 30,147 | $ | 28,240 | |||
| Earnings per common share | |||||||
| Basic | $ | 0.51 | $ | 0.49 | |||
| Diluted | $ | 0.49 | $ | 0.48 | |||
| Weighted average shares outstanding | |||||||
| Basic | 58,897 | 57,958 | |||||
| Diluted | 61,278 | 58,567 | |||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
| (Unaudited, in thousands) | |||||||
| Three Months Ended | |||||||
| March 31, | |||||||
| 2025 | 2024 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net income | $ | 30,147 | $ | 28,240 | |||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
| Depreciation and amortization | 29,292 | 23,599 | |||||
| Write-off of certain intangible assets and other long-term assets | 32 | 202 | |||||
| Amortization of right-of-use operating lease assets | 2,984 | 3,122 | |||||
| Fair value adjustments related to contingent consideration liabilities | 1,023 | (117 | ) | ||||
| Stock-based compensation expense | 9,078 | 5,234 | |||||
| Other adjustments | 1,475 | 1,486 | |||||
| Changes in operating assets and liabilities, net of acquisitions | (33,459 | ) | (25,550 | ) | |||
| Total adjustments | 10,425 | 7,976 | |||||
| Net cash, cash equivalents, and restricted cash provided by operating activities | 40,572 | 36,216 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Capital expenditures for property and equipment | (21,061 | ) | (11,682 | ) | |||
| Cash paid for notes receivable and other investments | (7,117 | ) | (6,508 | ) | |||
| Cash paid in acquisitions, net of cash acquired | (1,000 | ) | (3,000 | ) | |||
| Other investing, net | (457 | ) | (861 | ) | |||
| Net cash, cash equivalents, and restricted cash used in investing activities | (29,635 | ) | (22,051 | ) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
| Proceeds from issuance of common stock | 13,152 | 7,730 | |||||
| Proceeds from (payments on) long-term debt | — | (24,063 | ) | ||||
| Contingent payments related to acquisitions | (52 | ) | (78 | ) | |||
| Payment of taxes related to an exchange of common stock | (6,145 | ) | (1,592 | ) | |||
| Net cash, cash equivalents, and restricted cash provided by (used in) financing activities | 6,955 | (18,003 | ) | ||||
| Effect of exchange rates on cash | 936 | (1,319 | ) | ||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 18,828 | (5,157 | ) | ||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH: | |||||||
| Beginning of period | 378,767 | 589,144 | |||||
| End of period | $ | 397,595 | $ | 583,987 | |||
| RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH TO THE CONSOLIDATED BALANCE SHEETS: | |||||||
| Cash and cash equivalents | 395,529 | 581,921 | |||||
| Restricted cash reported in prepaid expenses and other current assets | 2,066 | 2,066 | |||||
| Total cash, cash equivalents and restricted cash | $ | 397,595 | $ | 583,987 | |||
Non-GAAP Financial Measures
Although Merit’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), Merit’s management believes that the non-GAAP financial measures referenced in this release may provide investors with useful information regarding the underlying business trends and performance of Merit’s ongoing operations and can be useful for period-over-period comparisons of such operations. Non-GAAP financial measures used in this release include:
- constant currency revenue;
- constant currency revenue, organic;
- non-GAAP gross profit and margin;
- non-GAAP operating income and margin;
- non-GAAP net income;
- non-GAAP earnings per share; and
- free cash flow.
Merit’s management team uses these non-GAAP financial measures to evaluate Merit’s profitability and efficiency, to compare operating and financial results to prior periods, to evaluate changes in the results of its operating segments, and to measure and allocate financial resources internally. However, Merit’s management does not consider such non-GAAP measures in isolation or as an alternative to measures determined in accordance with GAAP.
Readers should consider non-GAAP measures used in this release in addition to, not as a substitute for, financial reporting measures prepared in accordance with GAAP. These non-GAAP financial measures generally exclude some, but not all, items that may affect Merit’s net income. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which items are excluded. Merit believes it is useful to exclude such items in the calculation of non-GAAP gross profit and margin, non-GAAP operating income and margin, non-GAAP net income, and non-GAAP earnings per share (in each case, as further illustrated in the reconciliation tables below) because such amounts in any specific period may not directly correlate to the underlying performance of Merit’s business operations and can vary significantly between periods as a result of factors such as acquisition or other extraordinary transactions, non-cash expenses related to amortization or write-off of previously acquired tangible and intangible assets, certain employee termination benefits, expenses resulting from non-ordinary course litigation or administrative proceedings and resulting settlements, governmental proceedings or changes in tax or industry regulations, gains or losses on disposal of certain assets, and debt issuance costs. Merit may incur similar types of expenses in the future, and the non-GAAP financial information included in this release should not be viewed as a statement or indication that these types of expenses will not recur. Additionally, the non-GAAP financial measures used in this release may not be comparable with similarly titled measures of other companies. Merit urges readers to review the reconciliations of its non-GAAP financial measures to their most directly comparable GAAP financial measures included herein, and not to rely on any single financial measure to evaluate Merit’s business or results of operations.
Constant Currency Revenue
Merit’s constant currency revenue is prepared by converting the current-period reported revenue of subsidiaries whose functional currency is a currency other than the U.S. dollar at the applicable foreign exchange rates in effect during the comparable prior-year period and adjusting for the effects of hedging transactions on reported revenue, which are recorded in the U.S. dollar. The constant currency revenue adjustment of
Constant Currency Revenue, Organic
Merit’s constant currency revenue, organic, is defined, with respect to prior fiscal year periods, as GAAP revenue. With respect to current fiscal year periods, constant currency revenue, organic, is defined as constant currency revenue (as defined above), less revenue from certain acquisitions. For the three-month period ended March 31, 2025, Merit’s constant currency revenue, organic, excludes revenues attributable to (i) the assets acquired from Cook Medical Holdings, LLC (“Cook Medical”) in November 2024 and (ii) the assets acquired from EndoGastric Solutions, Inc. (“EGS”) in July 2024.
Non-GAAP Gross Profit and Margin
Non-GAAP gross profit is calculated by reducing GAAP cost of sales by amounts recorded for amortization of intangible assets. Non-GAAP gross margin is calculated by dividing non-GAAP gross profit by reported net sales.
Non-GAAP Operating Income and Margin
Non-GAAP operating income is calculated by adjusting GAAP operating income for certain items which are deemed by Merit’s management to be outside of core operations and vary in amount and frequency among periods, such as expenses related to acquisitions or other extraordinary transactions, non-cash expenses related to amortization or write-off of previously acquired tangible and intangible assets, certain employee termination benefits, performance-based stock compensation expenses, expenses resulting from non-ordinary course litigation or administrative proceedings and resulting settlements, governmental proceedings, and changes in governmental or industry regulations, as well as other items referenced in the tables below. Non-GAAP operating margin is calculated by dividing non-GAAP operating income by reported net sales.
Non-GAAP Net Income
Non-GAAP net income is calculated by adjusting GAAP net income for the items set forth in the definition of non-GAAP operating income above, as well as for expenses related to debt issuance costs and other items set forth in the tables below.
Non-GAAP EPS
Non-GAAP EPS is defined as non-GAAP net income divided by the diluted shares outstanding for the corresponding period.
Free Cash Flow
Free cash flow is defined as cash flow from operations calculated in accordance with GAAP, less capital expenditures for property and equipment calculated in accordance with GAAP, as set forth in the consolidated statement of cash flows.
Non-GAAP Financial Measure Reconciliations
The following tables set forth supplemental financial data and corresponding reconciliations of non-GAAP financial measures to Merit’s corresponding financial measures prepared in accordance with GAAP, in each case, for the three-month periods ended March 31, 2025 and 2024. The non-GAAP income adjustments referenced in the following tables do not reflect non-performance-based stock compensation expense of
Reconciliation of GAAP Net Income to Non-GAAP Net Income
(Unaudited, in thousands except per share amounts)
| Three Months Ended | |||||||||||||||
| March 31, 2025 | |||||||||||||||
| Pre-Tax | Tax Impact | After-Tax | Per Share Impact | ||||||||||||
| GAAP net income | $ | 37,958 | $ | (7,811 | ) | $ | 30,147 | $ | 0.49 | ||||||
| Non-GAAP adjustments: | |||||||||||||||
| Cost of Sales | |||||||||||||||
| Amortization of intangibles | 17,606 | (4,160 | ) | 13,446 | 0.22 | ||||||||||
| Operating Expenses | |||||||||||||||
| Contingent consideration expense | 1,023 | 9 | 1,032 | 0.02 | |||||||||||
| Amortization of intangibles | 2,394 | (566 | ) | 1,828 | 0.03 | ||||||||||
| Performance-based share-based compensation (b) | 4,774 | (586 | ) | 4,188 | 0.07 | ||||||||||
| Acquisition-related | 16 | (4 | ) | 12 | 0.00 | ||||||||||
| Medical Device Regulation expenses (c) | 1,594 | (377 | ) | 1,217 | 0.02 | ||||||||||
| Other (d) | (21 | ) | 5 | (16 | ) | (0.00 | ) | ||||||||
| Other (Income) Expense | |||||||||||||||
| Amortization of long-term debt issuance costs | 1,414 | (334 | ) | 1,080 | 0.02 | ||||||||||
| Non-GAAP net income | $ | 66,758 | $ | (13,824 | ) | $ | 52,934 | $ | 0.86 | ||||||
| Diluted shares | 61,278 | ||||||||||||||
| Three Months Ended | |||||||||||||||
| March 31, 2024 (a) | |||||||||||||||
| Pre-Tax | Tax Impact | After-Tax | Per Share Impact | ||||||||||||
| GAAP net income | $ | 34,348 | $ | (6,108 | ) | $ | 28,240 | $ | 0.48 | ||||||
| Non-GAAP adjustments: | |||||||||||||||
| Cost of Sales | |||||||||||||||
| Amortization of intangibles | 12,805 | (3,028 | ) | 9,777 | 0.17 | ||||||||||
| Operating Expenses | |||||||||||||||
| Contingent consideration benefit | (117 | ) | 47 | (70 | ) | (0.00 | ) | ||||||||
| Amortization of intangibles | 1,764 | (417 | ) | 1,347 | 0.02 | ||||||||||
| Performance-based share-based compensation (b) | 2,128 | (294 | ) | 1,834 | 0.03 | ||||||||||
| Acquisition-related | 38 | (9 | ) | 29 | 0.00 | ||||||||||
| Medical Device Regulation expenses (c) | 2,207 | (521 | ) | 1,686 | 0.03 | ||||||||||
| Other (d) | 122 | (30 | ) | 92 | 0.00 | ||||||||||
| Other (Income) Expense | |||||||||||||||
| Amortization of long-term debt issuance costs | 1,477 | (348 | ) | 1,129 | 0.02 | ||||||||||
| Non-GAAP net income | $ | 54,772 | $ | (10,708 | ) | $ | 44,064 | $ | 0.75 | ||||||
| Diluted shares | 58,567 | ||||||||||||||
_____________________________
Note: Certain per-share impacts may not sum to totals due to rounding.
Reconciliation of Reported Operating Income to Non-GAAP Operating Income
(Unaudited, in thousands except percentages)
| Three Months Ended | Three Months Ended | ||||||||||||||
| March 31, 2025 | March 31, 2024 (a) | ||||||||||||||
| Amounts | % Sales | Amounts | % Sales | ||||||||||||
| Net Sales as Reported | $ | 355,351 | $ | 323,508 | |||||||||||
| GAAP Operating Income | 41,033 | 11.5 | % | 35,922 | 11.1 | % | |||||||||
| Cost of Sales | |||||||||||||||
| Amortization of intangibles | 17,606 | 5.0 | % | 12,805 | 4.0 | % | |||||||||
| Operating Expenses | |||||||||||||||
| Contingent consideration expense (benefit) | 1,023 | 0.3 | % | (117 | ) | (0.0 | ) | % | |||||||
| Amortization of intangibles | 2,394 | 0.7 | % | 1,764 | 0.5 | % | |||||||||
| Performance-based share-based compensation (b) | 4,774 | 1.3 | % | 2,128 | 0.7 | % | |||||||||
| Acquisition-related | 16 | 0.0 | % | 38 | 0.0 | % | |||||||||
| Medical Device Regulation expenses (c) | 1,594 | 0.4 | % | 2,207 | 0.7 | % | |||||||||
| Other (d) | (21 | ) | (0.0 | ) | % | 122 | 0.0 | % | |||||||
| Non-GAAP Operating Income | $ | 68,419 | 19.3 | % | $ | 54,869 | 17.0 | % | |||||||
_____________________________
Note: Certain percentages may not sum to totals due to rounding.
| (a) | Beginning in the second quarter of 2024, consulting expenses associated with initiatives conducted under Merit’s Foundations for Growth Program (“FFG Program”) have not been adjusted as part of its non-GAAP financial measures. As a result, Merit’s non-GAAP financial measures for prior periods have been recast for comparability. For the three-month period ended March 31, 2024, Merit’s non-GAAP financial measures have been updated to no longer adjust |
| (b) | Represents performance-based share-based compensation expense, including stock-settled and cash-settled awards. |
| (c) | Represents incremental expenses incurred to comply with the E.U. Medical Device Regulation. |
| (d) | Represents costs to comply with Merit’s corporate integrity agreement with the U.S. Department of Justice (the “DOJ”). |
Reconciliation of Reported Revenue to Constant Currency Revenue (Non-GAAP), and Constant Currency Revenue, Organic (Non-GAAP)
(Unaudited, in thousands except percentages)
| Three Months Ended | |||||||||
| March31, | |||||||||
| % Change | 2025 | 2024 | |||||||
| Reported Revenue | 9.8 | % | $ | 355,351 | $ | 323,508 | |||
| Add: Impact of foreign exchange | 3,405 | — | |||||||
| Constant Currency Revenue (a) | 10.9 | % | $ | 358,756 | $ | 323,508 | |||
| Less: Revenue from certain acquisitions | (15,789 | ) | — | ||||||
| Constant Currency Revenue, Organic (a) | 6.0 | % | $ | 342,967 | $ | 323,508 | |||
_____________________________
| (a) | A non-GAAP financial measure. For a definition of this and other non-GAAP financial measures, see the section of this release entitled “Non-GAAP Financial Measures.” |
Reconciliation of Reported Gross Margin to Non-GAAP Gross Margin (Non-GAAP)
(Unaudited, as a percentage of reported revenue)
| Three Months Ended | |||||
| March 31, | |||||
| 2025 | 2024 | ||||
| Reported Gross Margin | 48.4 | % | 46.9 | % | |
| Add back impact of: | |||||
| Amortization of intangibles | 5.0 | % | 4.0 | % | |
| Non-GAAP Gross Margin | 53.4 | % | 50.9 | % | |
_____________________________
Note: Certain percentages may not sum to totals due to rounding.
ABOUT MERIT
Founded in 1987, Merit is engaged in the development, manufacture, and distribution of proprietary medical devices used in interventional, diagnostic, and therapeutic procedures, particularly in cardiology, radiology, oncology, critical care, and endoscopy. Merit serves customers worldwide with a domestic and international sales force and clinical support team totaling more than 800 individuals. Merit employs approximately 7,300 people worldwide.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This release contains 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. Forward-looking statements include, among others:
- statements proceeded or followed by, or that include the words, “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “intends,” “seeks,” “believes,” “estimates,” “projects,” “forecasts,” “potential,” “target,” “continue,” “upcoming,” “optimistic” or other forms of these words or similar words or expressions, or the negative thereof or other comparable terminology;
- statements that address Merit’s future operating performance or events or developments that Merit’s management expects or anticipates will occur, including, without limitation, any statements regarding Merit’s projected revenues, earnings or other financial measures, Merit’s plans and objectives for future operations, Merit’s proposed new products or services, the integration, development or commercialization of the business or any assets acquired from other parties, future economic conditions or performance, the implementation of, and results which may be achieved through, Merit’s Continued Growth Initiatives Program or other business optimization initiatives, and any statements of assumptions underlying any of the foregoing; and
- statements regarding Merit’s past performance, efforts, or results about which inferences or assumptions may be made, including statements proceeded or followed by the words "preliminary," "initial," "potential," "possible," "diligence," "industry-leading," "compliant," "indications," or "early feedback" or other forms of these words or similar words or expressions, or the negative thereof or other comparable terminology.
The forward-looking statements contained in this release are based on Merit management’s current expectations and assumptions regarding future events or outcomes. If underlying expectations or assumptions prove inaccurate, or risks or uncertainties materialize, actual results will likely differ, and could differ materially, from Merit’s expectations reflected in any forward-looking statements. Financial estimates are subject to change and are not intended to be relied upon as predictions of future operating results. Investors are cautioned not to unduly rely on any such forward-looking statements.
The following are some of the important risks and uncertainties that could cause Merit’s actual results to differ from Merit’s expectations in any forward-looking statements: risks and uncertainties regarding trade policies or related actions implemented by the U.S. or other countries, including existing, proposed or prospective tariffs, duties or other measures; inherent risks and uncertainties associated with Merit’s integration of businesses or assets acquired from third parties, including the businesses and assets acquired from Cook Medical in November 2024 and EGS in July 2024, and Merit’s ability to achieve the anticipated operating and financial results, product development and other anticipated benefits of such acquisitions; effects of the Convertible Notes on Merit’s net income and earnings per share performance; disruptions in Merit’s supply chain, manufacturing or sterilization processes; U.S. and global political, economic, competitive, reimbursement and regulatory conditions; reduced availability of, and price increases associated with, components and other raw materials; increases in transportation expenses; risks relating to Merit’s potential inability to successfully manage growth through acquisitions generally, including the inability to effectively integrate acquired operations or products or commercialize technology developed internally or acquired through completed, proposed or future transactions; fluctuations in interest or foreign currency exchange rates and inflation; risks and uncertainties associated with Merit’s information technology systems, including the potential for breaches of security and evolving regulations regarding privacy and data protection; governmental scrutiny and regulation of the medical device industry, including governmental inquiries, investigations and proceedings involving Merit; difficulties relating to development, testing and regulatory approval, clearance and maintenance of Merit’s products; the safety, efficacy and patient and physician adoption of Merit’s products; uncertainties regarding enrollment and outcomes of ongoing and future clinical trials and market studies relating to Merit’s products; modification or limitation of governmental or private insurance reimbursement policies; litigation and other judicial proceedings affecting Merit; the potential of fines, penalties or other adverse consequences if Merit’s employees or agents violate the U.S Foreign Corrupt Practices Act or other laws or regulations; consequences associated with a Corporate Integrity Agreement executed between Merit and the DOJ; restrictions on Merit’s liquidity or business operations resulting from its debt agreements; infringement of Merit’s technology or the assertion that Merit’s technology infringes the rights of other parties; product recalls and product liability claims; potential for significant adverse changes in governing regulations; changes in tax laws and regulations in the United States or other jurisdictions or exposure to additional tax liabilities which may adversely affect Merit’s effective tax rate; termination of relationships with Merit’s suppliers, or failure of such suppliers to perform; development of new products and technology that could render Merit’s existing or future products obsolete; market acceptance of new products; dependence on distributors to commercialize Merit’s products in various jurisdictions outside the U.S.; failure to comply with applicable environmental laws; changes in key personnel; labor shortages and increases in labor costs; price and product competition; extreme weather events; and geopolitical events. For a further discussion of the risks and uncertainties which may affect Merit’s business, operations and financial condition, see Part I, Item 1A, “Risk Factors” in Merit’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC, Part II, Item 1A, “Risk Factors” in Merit’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 filed with the SEC and Merit’s other filings with the SEC.
All subsequent forward-looking statements attributable to Merit or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Actual results will likely differ, and may differ materially, from anticipated results. Financial estimates are subject to change and are not intended to be relied upon as predictions of future operating results. Those estimates and all other forward-looking statements included in this release are made only as of the date of this release, and except as otherwise required by applicable law, Merit assumes no obligation to update or disclose revisions to estimates and all other forward-looking statements.
TRADEMARKS
Unless noted otherwise, trademarks and registered trademarks used in this release are the property of Merit Medical Systems, Inc., its subsidiaries, or its licensors.
| Contacts: | |
| PR/Media Inquiries: Sarah Comstock Merit Medical +1-801-432-2864 sarah.comstock@merit.com | Investor Inquiries: Mike Piccinino, CFA, IRC ICR Healthcare +1-443-213-0509 mike.piccinino@icrhealthcare.com |
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