Company Reports

Zimmer Biomet reported second-quarter results that included a constant-currency topline of 5% and flat adjusted EPS growth, driven by trauma and extremities, as well as technology and data.

Zimmer Biomet reported first-quarter revenue of $2.09 billion, up 9.3% year over year, while organic, constant-currency growth was 3%. The operating margin rose by 260 basis points, and management increased its earnings per share outlook for 2026.

Zimmer Biomet is the market leader in large-joint reconstruction, and we expect aging baby boomers and improving technology suitable for younger patients to fuel solid demand for hip and knee replacement that should offset price declines. Zimmer stumbled into a series of pitfalls in 2016-17, including integration issues, supply and inventory challenges, and quality concerns. The firm's efforts to turn itself around have been admirable, though the pandemic slowed progress. Despite all the improvement, the firm still hasn't reached consistent growth and profitability gains.

Zimmer Biomet reported constant-currency growth of 9% on the top line and 3% in adjusted earnings per share for the fourth quarter. Slightly more than half the revenue growth was organic, with the remainder from acquisitions.

Zimmer Biomet's third-quarter performance included revenue up 9% in constant currency, but earnings fell 7% year over year as sales and marketing expense rose significantly. Management reduced the upper end of its 2025 organic revenue growth outlook by 50 basis points.

Zimmer Biomet saw second-quarter revenue growth of 5% in constant currency and adjusted operating margin decline by 140 basis points, driven mainly by the acquisition of Paragon 28.

Zimmer Biomet posted first-quarter results with flat US knee growth and consolidated revenue up 2% in constant currency. The sports medicine, extremities, and trauma division delivered stronger 5% growth, which supported earnings growth of 5%.

Zimmer Biomet is the undisputed king of large-joint reconstruction, and we expect aging baby boomers and improving technology suitable for younger patients to fuel solid demand for large-joint replacement that should offset price declines. Zimmer stumbled into a series of pitfalls in 2016-17, including integration issues, supply and inventory challenges, and quality concerns. The firm's efforts to turn itself around have been admirable, though the pandemic slowed progress. Now Zimmer is seeking to capitalize on the normalization of procedure volume and placements of its Rosa robot.

Despite intensive medtech industry lobbying to secure a carve-out from the Trump administration’s expansive tariffs on all countries, medical devices have been swept up in the tariff net.

Zimmer Biomet posted fourth-quarter revenue growth of 5% in constant currency, which is generally consistent with the preceding quarters in 2024.

Zimmer Biomet posted solid third-quarter results that featured continued mid-single-digit growth on the top line and a tight grip on costs.

Zimmer Biomet is the undisputed king of large-joint reconstruction, and we expect aging baby boomers and improving technology suitable for younger patients to fuel solid demand for large-joint replacement that should offset price declines. Zimmer stumbled into a series of pitfalls in 2016-17, including integration issues, supply and inventory challenges, and quality concerns. The firm's efforts to turn itself around have been admirable, though the pandemic slowed progress. Now Zimmer is seeking to capitalize on the normalization of procedure volume and placements of its Rosa robot.

Wide-moat Zimmer Biomet delivered decent second-quarter performance that generally met the firm’s goal of reaching mid-single-digit top-line growth that can be maintained. With few surprises, we’re leaving our fair value estimate unchanged for now. We’ve been largely pleased that the firm has been able to keep revenue growth around 5% in constant currency for the first half of the year, which puts it on track to meet our full-year estimates. Though there has been some pressure on gross margin, year to date it remains within arm’s length from our tempered projections.

Zimmer Biomet posted decent first-quarter results that held few surprises, and the firm remains on track to meet our full-year expectations. As a result, we're leaving our $175 fair value estimate unchanged. Quarterly revenue grew 4% in constant currency year over year, which we view as respectable, especially considering the outsize strength that fueled the prior-year period. Quarterly adjusted operating margin closely matched our estimate for the year, and we were pleased to see pricing hold up relatively well. We saw little in the quarter to shift our thinking on Zimmer Biomet's wide economic moat and the switching costs that orthopedic surgeons face.

Zimmer Biomet posted fourth-quarter and full-year results that ran slightly ahead of our expectations on the top and bottom lines, but not enough to materially shift our fair value estimate. Additionally, we continue to hold tempered expectations for 2024, which fall slightly short of management’s outlook, as we expect utilization of the Rosa robot and penetration of the higher-margin cementless knees are unlikely to make a quantum leap this year but instead to increase steadily and more gradually over time. However, market skepticism about whether Zimmer Biomet can reach management’s 2024 goals seems to have translated into pressure on shares. Nonetheless, we saw little in the quarter to change our thinking on Zimmer Biomet’s wide economic moat.

Zimmer Biomet is the undisputed king of large joint reconstruction, and we expect aging baby boomers and improving technology suitable for younger patients to fuel solid demand for large-joint replacement that should offset price declines. However, Zimmer stumbled into a series of pitfalls in 2016-17, including integration issues, supply and inventory challenges, and quality concerns. The firm's efforts to turn around the firm have been admirable, though the pandemic slowed down progress. Now the firm is seeking to capitalize on the normalization of procedure volume and placements of its Rosa robot.

Wide-moat Zimmer Biomet posted solid third-quarter performance, and we’re holding steady on our fair value estimate, as the firm’s year-to-date results are tracking nearly on the nose with our full-year estimates. Although management adjusted its outlook slightly downward to account for foreign currency headwinds, our projections for the full year remain bounded by the new guidance.

We’re surprised and disappointed by the news that Bryan Hanson has stepped down as chief executive officer at Zimmer Biomet to take a comparable position at 3M’s impending healthcare spinoff. With former COO Ivan Tornos named as the new president and CEO of Zimmer Biomet and CFO Suky Upadhyay assuming additional responsibilities for global operations and supply chain, we don’t expect any dramatic changes for now and are holding steady on our fair value estimate. We also see little to shift our thinking on Zimmer Biomet’s wide economic moat, which primarily stems from strong switching costs among surgeons. Having said that, we recognize that cultural issues were a crucial factor contributing to how bumpy the integration of Biomet was, and Hanson played a critical role in healing some of those divisions and putting the combined firm on a healthier path.

Wide-moat Zimmer Biomet posted second-quarter results that largely fell in line with our expectations, and the firm remains on track to meet our full-year projections, though the market might have been disappointed with management comments that suggested tempered expectations for 2024. Nonetheless, we're leaving our fair value estimate and 2024 view unchanged for now. With solid quarterly topline growth of 6% in constant currency and adjusted operating margin of 27%, Zimmer Biomet is making progress on its precoronavirus benchmark in 2019 on both measures. We recognize that the firm remains in the early stages of expanding the installed base of Rosa robots, which is a key factor in setting the stage for increased penetration of the new cementless Persona OsseoTi Keel knee. Fortunately, solid demand for large joint replacement fueled by the backlog of patients should help these placements along through 2024.

Wide-moat Zimmer Biomet delivered first-quarter results that exceeded most expectations, especially on the top line, and we've slightly dialed up our projections for the full year following this strength. However, these adjustments weren't enough to materially shift our fair value estimate, especially as the firm's first-quarter costs tracked closely along with our expectations. Zimmer Biomet's quarterly revenue growth of 13% (in constant currency) was within spitting distance of Stryker's 14% year-over-year growth. Similar to the cardiac device makers, most of the large orthopedic implant competitors received a boost from the comparison with a soft prior-year period. But even after accounting for that, the device makers saw robust quarterly growth thanks to increased medical utilization, easing labor conditions at providers, and improving access to component parts. Though we think it's unlikely that Zimmer Biomet can maintain this 13% growth through the full year, the strong start does suggest our original low-single-digit revenue growth assumption in 2023 was likely too low. We now estimate full-year sales growth should fall closer to 4.7%, after adjusting for foreign exchange headwinds.