Haemonetics Q4 2025 Earnings Call Transcript

Skip to Participants
Operator

Good day and thank you for standing by. Welcome to the Q4 twenty twenty five Humanoidix Corporation Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press 11 on your telephone.

Operator

You will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded. I would now like to turn the conference over to Oba Gaid, Vice President of Investor Relations and Treasury. Please go ahead.

Olga Guyette
Olga Guyette
VP - Investor Relations & Treasurer at Haemonetics

Good morning, and thank you all for joining us for Humanetics' fourth quarter and fiscal year twenty twenty five conference call and webcast. I'm joined today by Chris Simon, our CEO and James Dureka, our CFO. This morning, we posted our fourth quarter and fiscal year twenty twenty five results to our Investor Relations website, along with additional supplemental tables that support some of the assumptions within our fiscal year twenty twenty six guidance included in our earnings release. These supplemental tables help reconcile the projected fiscal year twenty twenty six growth rate of electrophysiology, coronary and prefilled procedures in The U. S.

Olga Guyette
Olga Guyette
VP - Investor Relations & Treasurer at Haemonetics

With the corresponding exercise opportunities for our vascular closure business. The exercise opportunities represent the anticipated growth of The U. S. Addressable market in vascular closure as incorporated in our hospital and total company revenue guidance for fiscal year twenty twenty six. Before we begin, just a quick reminder that all revenue growth rates discussed today are organic, unless specified otherwise, and exclude the impact of currency fluctuations, acquisitions and impacts of the whole blood divestiture.

Olga Guyette
Olga Guyette
VP - Investor Relations & Treasurer at Haemonetics

We'll also refer to other non GAAP financial measures to help investors understand Humanetics' ongoing business performance. Please note that these measures exclude certain charges and income items. A full list of excluded items, reconciliations to our GAAP results and comparisons with the prior year periods are provided in our fourth quarter fiscal year twenty twenty five earnings release available on our Web site. Our remarks today include forward looking statements, and our actual results may differ materially from anticipated results. Factors that may cause our results to differ include those referenced in the Safe Harbor statement in today's earnings release and in our other SEC filings.

Olga Guyette
Olga Guyette
VP - Investor Relations & Treasurer at Haemonetics

We do not undertake any obligation to update these forward looking statements. And now, I'd like to turn it over to Chris.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Thank you, Olga, and good morning, everyone. We appreciate you joining today. We delivered solid earnings growth in our fourth quarter and fiscal twenty twenty five with robust margin expansion and strong cash flow as evidence of the health and vitality of our businesses. Our industry leading Nexus, TAG and Vascave technologies continue to propel our growth in attractive markets, and we are on track to deliver all of the goals of our four year long range plan in fiscal twenty twenty six. We reported total revenue of $1,400,000,000 reflecting 4% growth on a reported basis and 1% organic.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

However, organic growth excluding $148,000,000 from CSL and the whole blood divestiture was 8%, a more accurate representation of our transformed portfolio. Hospitals become our largest business with both blood management technologies and interventional technology franchises building momentum and delivering double digit growth. Expanded reach and relevance are enabling us to capitalize on key trends and drive deeper penetration in critical areas of care. In plasma, we continue to expand margins and capture share as customers adopt our next generation technologies, further reinforcing our position as the industry leader. Having divested whole blood, our attention is on the remaining high value blood center plasma apheresis business.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

The operational agility of our global manufacturing and supply chain network enables us to successfully navigate ongoing macroeconomic headwinds. We've strengthened our leadership team by promoting Roy Galvin to Chief Commercial Officer and hiring Frank Chan as Chief Operating Officer. These appointments underscore our commitment to excellence and building new organizational capabilities to support scalable long term growth, especially in our hospital businesses. Additionally, we leveraged our strong balance sheet and cash flow to execute $150,000,000 share buyback repurchasing approximately 2,400,000.0 shares of Haemonetics common stock. This buyback reflects our commitment to value creation and our strong conviction in Haemonetics' long term growth trajectory.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Turning now to our revenue results and fiscal twenty twenty six guidance. Hospital revenue grew 12% in the quarter and 24% in fiscal twenty twenty five on a reported basis, with organic growth of 912% respectively. In Blood Management Technologies, our largest hospital franchise, revenue grew 6% in the quarter and October in fiscal twenty twenty five, driven by strong utilization, share gains and price benefits across the portfolio. Hemostasis management delivered an impressive quarter in fiscal twenty twenty five with U. S.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Revenue growth of 2023% respectively. Performance was driven by the successful launch and rapid adoption of the HN cartridge, accelerating new account openings and fueling customers' transition from the lab based TEG-five thousand to our advanced point of care TEG-6s. EMEA followed closely with strong growth across all key markets helping offset continued market challenges in China. This franchise also benefited from continued growth in transfusion management, strong capital sales and competitive market share gains in cell salvage in The U. S.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

The Interventional Technologies franchise delivered 21% reported growth in the quarter and 46% in fiscal twenty twenty five, with 1216% organic growth respectively. Growth in vascular closure was driven by our leadership in electrophysiology, where revenue from Bascade MVP and Vescade MVP XL grew 28% in the fourth quarter and 26% for the year. This performance was fueled by new account openings and increased utilization in The U. S, along with strong adoption of Bascade MVP in Japan, which contributed approximately 907 basis points to quarterly and full year EP revenue growth respectively. Strong EP performance was partially offset by a decline in our legacy Vascade business, which is primarily used in coronary and peripheral procedures.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Bascade represented less than 15% of vascular closure revenue in fiscal twenty twenty five in a market we estimate is growing at approximately 2% annually. We must capitalize on those procedures in the coming year. We are making progress across our sensor guided technologies portfolio. We recently reorganized our U. S.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Sales force to allocate undivided attention to the structural heart market. The dedicated team is driving meaningful performance improvements, including steady growth in the new SaviWire account openings in The U. S. And nearly double the account penetration rate by year end. While OptiWire growth remained stable, it was partially offset by OEM destocking.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We also continue to face pressure from pulse field ablation in our esophageal protection business. Moving to hospital guidance, we remain confident in the strong growth trajectory of our hospital business, with projected reported and organic revenue growth of 8% to 11% in fiscal twenty twenty six. This outlook assumes similar growth contributions from interventional technologies and blood management technologies. Within interventional technologies, we expect continued double digit revenue growth in vascular closure, driven by growth in procedures, share gains and improved utilization. As outlined in the supplemental tables posted this morning, we estimate 8.6% growth in addressable access sites in EP in The US.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We anticipate additional share gain and improved utilization of our devices across all addressable procedures. Because most key accounts are already penetrated in The US and Japan, growth will be increasingly driven by utilization, with a more modest growth contribution from Japan when compared with fiscal twenty twenty five. We also expect additional improvements with sensor guided technologies helping offset ongoing impacts from pulse field ablation on esophageal protection. In Blood Management Technologies, we expect double digit growth in hemostasis management, driven by the strong performance of TEG 6S, including additional TEG 5,000 device conversions, new account openings and increased utilization. Transfusion management is also expected to deliver double digit growth, partially offset by a tough comparison in Cell Saver following the capacity the capital replenishment cycle last year.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Moving to plasma and blood center. Due to the planned CSL transition, plasma revenue declined 9% in the quarter and 6% in fiscal twenty five. Excluding CSL, plasma revenue grew 11% in the fourth quarter and 5% for fiscal twenty twenty five, driven primarily by continued strong U. S. Growth through technology adoption and share gains.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

In The U. S, plasma collections ex share gains declined 4% in the fourth quarter and 7% sequentially, in line with typical seasonal patterns. In the full fiscal twenty twenty five, U. S. Collections declined 1% as collectors rebalanced inventories and prioritized cost per liter initiatives.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

With the Persona and Express Plus upgrades substantially completed, we've equipped our customers with a significant competitive advantage, boosting donor engagement, enhancing center efficiency, and lowering cost per liter. Looking ahead to fiscal twenty six, with the CSL transition completed, we expect plasma revenue to decline 7% to 10% on a reported basis. Organic growth ex CSL is expected to be 11% to 14%, disproportionately driven by share gains in The U. S. And internationally and prior technology adoption.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Our fiscal twenty twenty six revenue growth guidance assumes flat to low single digit volume growth in The U. S. With a modest rebound in collections anticipated in the second half of the year as customer yield and productivity benefits annualize. We remain confident in the mid to high single digit annual growth in demand for immunoglobulin, driven by the long term growth in plasma derived therapies and supported by increasing global fractionation capacity, historically a reliable predictor of accelerating plasma collection growth. Blood center revenue declined 22% in the quarter and 8% in fiscal twenty twenty five on a reported basis due to the whole blood divestiture.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Organic revenue was flat in the quarter and down 2% for the year. Apheresis revenue grew 2% both in the quarter and fiscal twenty twenty five, driven by global plasma share gains and strong U. S. Red cell collections. Additionally, following last quarter's award of the exclusive SORTS plasma collection contract from the Japanese Red Cross, we expanded that agreement to also become exclusive provider for fresh frozen plasma.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

FFP is typically used in transfusions requiring the highest medical standards and this further demonstrates the competitive strength of our technology and our position as a trusted partner. Whole blood contributed just under $2,000,000 in the quarter and $48,000,000 for the year, reflecting an organic decline of 16% in fiscal twenty twenty five before its divestiture in January. This divestiture represents an important milestone in our portfolio evolution enabling us to reallocate resources towards higher growth opportunities. Due to the impacts of the whole blood divestiture and exits of the liquids business, we expect blood center revenue to decline 23% to 26% on a reported basis in fiscal twenty six. Organic revenue is projected to decline four to 6% as we further streamline the portfolio and align investments to support growth elsewhere.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

James, over to you.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Thank you, Chris, and good morning, everyone. As we approach the final year of our current long range plan, I'm pleased to highlight the significant progress we've made in driving profitability across our portfolio. Our financial results reflect the continued evolution of our business, and we're seeing strong momentum in margin expansion fueled by strategic actions, improved operational efficiencies, and a well executed ongoing portfolio transformation. We concluded the fourth quarter with an adjusted gross margin of 60.2%, representing an increase of six twenty basis points compared to the prior year, driven by volume growth in hospital and improved and reshaped product mix across our portfolio as we continue to strategically emphasize higher margin products and price benefits, including those tied to technology adoption.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Our quarterly results also reflect 150 basis point benefit from the divestiture of the whole blood business and a one time $10,600,000,000 shortfall payment from CSL, representing approximately 100 basis points. The adjusted gross margin for fiscal 'twenty five was 57.4%, an increase of 300 basis points compared to the prior year, largely driven by the same factors as in the fourth quarter. We expect these trends to continue into fiscal 'twenty six, further expanding our margins. Adjusted operating expenses in the fourth quarter were 116,700,000 a decrease of 4,000,000 or 3% compared with the prior year's fourth quarter, mainly due to lower freight costs and performance based compensation. Adjusted operating expenses for fiscal 'twenty five were $455,500,000 an increase of $20,000,000 or 5% compared with the prior year.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

For the full fiscal year, the dollar increase in adjusted operating expenses was primarily due to the acquisitions of Opsense and Attune Medical, as well as additional investments to support growth, partially offset by lower performance based compensation. As a percentage of revenue, adjusted operating expenses were 35.3% in the fourth quarter and 33.5% in the full fiscal year, relatively flat when compared with the same periods of last year, reflecting our disciplined resource allocation while managing portfolio transitions and investing in innovation and other drivers of sustainable long term growth. Fourth quarter adjusted operating income grew 27% to $82,300,000 or an adjusted operating margin of 24.9%, up six ten basis points from last year. For the full fiscal year, adjusted operating income grew 18% to $326,300,000 and adjusted operating margin was 24%, up two ninety basis points versus fiscal 'twenty four. Key drivers in the quarter and fiscal 'twenty five included continued gross margin expansion, disciplined cost management, and incremental OEP savings that helped offset additional growth investments.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Following the successful divestiture of our whole blood business, we are sharpening our focus on the geographies and markets that offer the greatest opportunities for profitable growth and advancing our innovation agenda. Our new regional and market alignment initiative is expected to further strengthen our core business, while generating approximately $30,000,000 of net savings over the next two years, helping offset the financial impacts of CSL's transition, the divestiture of the whole blood business, and additional rationalization efforts in the apheresis business. We expect about two thirds of these savings will be realized in fiscal 'twenty six. The adjusted income tax rate was 22% for the fourth quarter and 23% for fiscal year 'twenty five, compared with 2123% for the respective periods of the prior year. Fourth quarter adjusted net income was $61,600,000 up $16,000,000 or 34%.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

And adjusted earnings per diluted share was $1.24 up 39% compared with the fourth quarter of fiscal 'twenty four. Adjusted net income for fiscal year 'twenty five was $231,500,000 up $28,000,000 or 14%. And adjusted earnings per diluted share was $4.57 up 15% compared to the prior year. Below the line items, including interest expense, foreign exchange adjustments, taxes, and lower share count added about $0.13 to the fourth quarter adjusted EPS, but created a $0.20 headwind for the year, mainly due to higher interest expense. Moving to select balance sheet and cash flow highlights.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

In fiscal 'twenty five, we generated $182,000,000 in cash from operating activities, the same as in the prior year, as higher net income was offset by the timing of certain payments, which were heavily weighted towards the beginning of our fiscal twenty twenty five, and continuous efforts to rebuild the safety stock of our critical inventories. Free cash flow grew 24% to $145,000,000 exceeding expectations, with the free cash flow conversion ratio of 63% of adjusted net income, up from 57% last year. This increase reflects strong operating performance, coupled with the additional proceeds from the sale of one of our manufacturing facilities at the start of fiscal twenty twenty five and lower CapEx. Strong, consistent cash flow generation remains a key strength at Haemonetics, and we continue to prioritize free cash flow as a strategic driver of growth and value creation. We finished our fiscal year with $3.00 $7,000,000 in cash, an increase of $128,000,000 since the start of the fiscal year, driven by strong operating cash flow and debt transactions, partially offset by the acquisition of Attune Medical and two twenty five million dollars in share buybacks.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

There were no changes to our debt structure during the quarter, and we had no outstanding borrowings on our revolving credit facility. Our net leverage ratio stood at approximately 2.52 times EBITDA, as defined in our credit agreement, providing significant financial flexibility to support continued growth through a balanced mix of growth investments, share repurchases, and debt repayments. In alignment with our capital allocation priorities and following the successful completion of our $300,000,000 share repurchase program, this morning, we announced that the Board of Directors has authorized a new program to repurchase up to $500,000,000 of the company's common stock over the next three years. This new authorization reinforces our commitment to maximizing shareholder value and optimizing Immunetics' capital structure. Moving to fiscal 'twenty six guidance.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

We're entering fiscal 'twenty six with strong momentum and a clear line of sight to our long range plan goals. While reported revenue is expected to decline 3% to 6%, driven by the full year impact of the whole blood divestiture, CSL's transition, and exits of the liquids business, together representing $153,000,000 headwind, we remain firmly on track to deliver against every long range plan commitment we've made. We expect organic growth, ex CSL, of 6%

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

to 9%,

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

supported by balanced contributions from our plasma and hospital businesses. Our ongoing transformation is driving meaningful margin expansion as our portfolio shifts toward higher margin, growth oriented products. We expect adjusted operating margin to improve by two to 300 basis points, reaching 26% to 27% in fiscal twenty twenty six. This improvement is supported by continued gains in adjusted gross margin, keeping us on track to achieve our long range plan targets in the high 50s to low 60s. As in the prior year, margin expansion is expected to build throughout the year.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

We anticipate adjusted earnings per diluted share in the range of $4.7 to $5 At the midpoint of our outlook, recent share repurchase activity is expected to offset the impact of increased interest expense. The anticipated increase in interest expense is primarily driven by lower interest income, reflecting a lower interest rate environment and the assumed use of cash to retire the remaining $300,000,000 of our 2026 convertible securities at maturity. As we approach these maturities, we will continue to evaluate the most efficient and value enhancing options for settlement. We anticipate the adjusted tax rate to increase to approximately 24.5% in fiscal 'twenty six, compared to 23% in fiscal 'twenty five. The tariff environment remains highly dynamic.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

However, with the majority of our revenue concentrated in The US and coming from high volume growth products like plasma, TEG, and vascular closure, primarily manufactured in The US or USMCA compliant regions, we believe we are in a strong position to manage the near term risk while taking proactive steps to reduce long term impacts. We estimate an annualized adjusted EPS impact of up to $0.20 assuming the most recently announced tariff rates and exemptions that have been put in place for USMCA compliant products manufactured in Mexico or Canada. The midpoint of our fiscal twenty six adjusted EPS guidance already reflects this impact, including the benefits from prior actions like inventory builds and supply chain diversifications. With our teams fully engaged, we are well positioned to further reduce tariff exposure beyond fiscal 'twenty six through additional risk mitigation measures. And lastly, with heightened focus on cash flow generation throughout the organization, we expect our free cash flow in fiscal twenty twenty six to be in the range of 160,000,000 to $200,000,000 We expect our free cash flow to adjusted net income conversion ratio to be in excess of 70%, a testament to our improved operational efficiency and strong financial stewardship across the organization.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Thank you. And I'll now turn it back to Chris for some closing comments.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Thanks, James. I'd like to offer a few reflections, if I might. In fiscal twenty twenty two, excluding CSL, we earned $1.83 in adjusted earnings per share.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We issued a new four year LRP with ambitious targets, including low double digit compounded annual growth in revenue and mid-20s adjusted EPS compound annual growth rate, excluding CSL. We targeted adjusted operating margin expansion into the high 20s in fiscal 'twenty six, and cumulative free cash flow generation of $6 to $700,000,000 The dialogue at the time was mostly about CSL's impending transition, the growth of our hospital franchises, and our projected margin expansion. Despite the challenges of the past year, we remain confident in our strategy and our ability to deliver these goals. Nearly 85% of our revenue is now generated by high growth, high margin products driving accelerated growth and profitability. At the midpoint of our FY '20 '20 '6 guidance range, we expect approximately $1,300,000,000 in revenue, representing a 10% compound annual growth rate and about $4.85 in adjusted earnings per diluted share, more than $3 greater than our FY 'twenty two results.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

That's a 28% compound annual growth rate in earnings from a significantly more profitable, diversified, and sustainable portfolio. We have a clear path forward with Interventional Technologies, having realigned our sales organization and invested in new clinical evidence to drive momentum. TEG 6s continues to propel growth, driving device conversions and increased utilization as we migrate customers to our point of care viscoelastic testing system. Technology upgrades and competitive wins in plasma are fueling revenue growth and strengthening our leadership in The U. S.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

And internationally. Margin expansion is progressing as planned, and we are well positioned to sustain and build upon this momentum. We have a renewed emphasis on free cash flow generation, a strong capital position and the capacity to fund additional growth. Our near term priorities are organic growth, debt repayments and opportunistic buybacks. We are executing effectively, evolving strategically and creating significant value for customers and shareholders.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We are confident that we are positioning the company for continued profitable growth and long term value creation. Thank you again. Operator, please open the line for questions.

Operator

Thank you. We also ask that you please wait for your name and company to be announced before proceeding with your question. One moment while we compile the Q and A roster. Our first question is coming from the line of Rohan Patel of JPMorgan. Your line is open.

Rohin Patel
Rohin Patel
Vice President at JP Morgan

Hi, thanks for taking the question and congrats on a good quarter. I wanted to start with plasma. You had a nice beat in the quarter and the guide for fiscal twenty six came in at 11% to 14% excluding CSL, which was ahead of expectations and some of your prior commentary just a few months ago. So maybe if you could just talk more about what you're seeing as far as the collections environment and what's assumed in guidance between pricing, share gains and volumes and how we should think about this contributing to plasma and total company margins in fiscal twenty six? And then I had a follow-up.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Good morning, Rowan. It's Chris. Thanks for the question. Yeah, we remain very bullish on plasma near and longer term. The underlying demand for IG remains really robust as evidenced by our customers and market growth in their therapies.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

So when we look at what's going on for certainly our fiscal twenty twenty five and into our projected plans for fiscal twenty twenty six as a temporary pullback, largely enabled by our technology where we've given them substantial improvements in throughputs and yield from their centers. The 11% to 14% is almost entirely share gains and a premium associated with our upgraded technology adoption. We don't see meaningful growth in the first half of our fiscal twenty twenty six in terms of collection volume. We do believe based on in-depth discussion and planning with our customers that that'll change in the second half of the year. But even still, it's going to be relatively modest as they digest the improvements we've given them and get back on track to really drive it to meet further demand and talk more why we're bullish on the long term demand.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

But we remain confident in what we're doing in plasma and its contribution to the portfolio more broadly.

Rohin Patel
Rohin Patel
Vice President at JP Morgan

Great. And then I guess my follow-up is on EPS. You obviously guided to $4.7 to $5 in fiscal twenty twenty six, which also includes your 26% to 27% operating margin, which is on track for your LRP. So can you just elaborate more on the drivers here from a gross margin and OpEx standpoint? You mentioned some expense management initiatives and also $0.20 assumed for tariff impact.

Rohin Patel
Rohin Patel
Vice President at JP Morgan

So, what does that include exactly? And do you see upside to this given some of the progress we're seeing on trade talks and potential exemptions? Thanks.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Hi, Brian. Thanks, James Dureka. Yes, so I'll start with the operating margin of 26% to 27%. We see continued improvement in gross margin mix that's going to be driving that into our fiscal twenty five. As we rationalize the portfolio, the gross margins have continued to improve.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

So you heard me on the call earlier talking about whole blood for example, will have about 150 basis point impact on gross margin improvement and some of that will fall to the bottom line. And we'll continue to see gross margins improving through fiscal twenty twenty six and that's going to drive most of our improvement as we head into fiscal twenty twenty six. I think some of the operating leverage that we had anticipated that will be coming more towards the back part of the year as the hospital business starts to gather more momentum in that regard. With regard to tariffs, we have as our starting point, as you heard me say, the $0.20 is our annualized impact. And that's really like I said, our starting point.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Since we have sufficient inventory levels, we do have the time and flexibility to address the impacts by diversifying our supply chain, in sourcing production and seeking other mitigation activities and we'll continue to do that. So essentially, we've built in that about half of that at the midpoint of our range. We feel comfortable with that. We have line of sight to that and we also now have the ability to continue to work on mitigating tariffs as we move forward really into fiscal twenty twenty seven. The good news for us really on tariffs is that the majority of our revenue is primarily concentrated in North America and The U.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

S. And our key drivers, plasma, TEG and vascular closure, those products are all either manufactured in The U. S. Or are in U. S.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

MCA compliant countries like Mexico or Canada. So on the revenue side, we're in very good shape. So I'll pause there. Hopefully that gives you some additional color.

Rohin Patel
Rohin Patel
Vice President at JP Morgan

Yes, thank you.

Operator

Thank you. One moment for the next question. And the next question is coming from the line of Marie Thelbeck of BTIG. Your line is open.

Marie Thibault
Managing Director at BTIG

Hi, thanks for taking the questions this morning. Wanted to drill down a little bit more vascular closure portfolio. You reported some very nice growth from the newer products like MVP and XL and then discussed some efforts on the PCI side. Would love to kind of just understand that in a little bit more detail. What were you seeing in terms of share gains, new accounts, new account penetration with some of those newer products?

Marie Thibault
Managing Director at BTIG

And what specifically is being done at this point to try to improve the performance in sort of the legacy side of the business on the PCI side?

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Thanks, Marie. It's Chris. So we've published some supplemental tables. We just want to try to be clear about what we believe to be the opportunity set, the total addressable market, which is a function of the procedures we can participate in and the ongoing change in the number of access sites per procedure given the focus on closure. So hopefully that is helpful.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

What it says is, in The U. S. For FY 2026, we're looking at something that's high single digit 88.5% to 9% growth in opportunity. We expect to participate fully in that. Were impressed by the team's results in the fourth quarter with regard to focus for MVP and MVP XL were back in the high 20s in terms of that growth rate, which is excellent.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We do need to factor in what's happening in coronary and peripheral, which continues to be a drag on that growth rate. We are addressing it. And we think our heightened focus, where we've really targeted our U. S. Field force to go either directly in on vascular closure in all opportunities or structural heart where we've carved out a dedicated effort and we think that's producing some interesting new growth green shoots that we're enthusiastic about going forward.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

So from our vantage point, yeah, we're taking a step back. We want to be balanced because we don't control a number of the things that are disrupting the market. But the attach rate on PFA for example, we estimate that the leading players there are in probably 60% of what we target as the T600 accounts, those accounts that represent 90 plus percent of the opportunity. Of that 60%, we're in 85% of that with them. So as they convert the accounts, come through the door behind them and we have the best product and the best set of relationships there.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

So we're going to continue to see good growth, but it is balanced. It's balanced across the broader portfolio. And then we're addressing the acquired products as part of it. And like I said, we see some green shoots with our structural heart play, but there's more work to do. And we think FY twenty six will be a good opportunity for that leadership team to really address the market and get back to where we want them to be going forward.

Marie Thibault
Managing Director at BTIG

Okay, perfect. Maybe I can ask a follow-up on that. I know that there was a management change, I think, during the quarter. The former head of hospital transitioned out of the role, and I think it's Mr. Galvin, I think that that's added that role to his responsibilities.

Marie Thibault
Managing Director at BTIG

Wanted to understand any changes to strategy that came along with that. And as you've seen, you know, kind of a nice ramp in hospital revenue over the past couple of years, is there a way to kind of quantify or maybe qualitatively give us an idea of the margin expansion that this segment has seen?

Marie Thibault
Managing Director at BTIG

I know

Marie Thibault
Managing Director at BTIG

a big contributor to margin expansion.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yes. Thanks, Marie. It is a big contributor to margin expansion. In a nutshell, and I thought the note you issued on us when you initiated coverage was a really thoughtful articulation of this. We're playing and winning in collections.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

It's an important source of baseline growth, EBITDA, free cash flow, etcetera. But the real opportunity is to use that benefits there to invest profitably in building out a hospital portfolio, which today consists of blood management technologies and interventional technologies. We see the gross margin of that business in excess of 70%, And with corresponding MedSurg operating income, which certainly puts it into the high 20s, which is what we're guiding towards now. So very powerful contributions. With regards to the leadership changes, super grateful to Stu Strong and his team.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

I think they took that business under Stu's tenure from less than $200,000,000 to the 500,000,000 to $600,000,000 that it is today. And we're excited about that with double digit growth. Going forward, we expect, and I realize the audacity of what I'm about to say, but it is our plan, we expect both blood management technologies and interventional technologies to be billion dollar franchises each. And Roy brings a skill set and a capability to help those franchise presidents take their business to that level. And I think we're excited about the opportunity in front of us.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We need to make sure we're organized appropriately, so both Roy and Frank Chan as their Chief Operating Officer bring a set of capabilities and a level of talent that is indicative of our growth aspiration, particularly in the hospital space.

Marie Thibault
Managing Director at BTIG

Thank you.

Operator

Thank you. One moment for the next question. And the next question will be coming from the line of Mike Matson of Needham and Company. Your line is open.

Mike Matson
Senior Equity Research Analyst at Needham & Company

Yeah. Thanks. You know, so just looking at kinda, you know, where you've guided for for '26 for you know, from an organic perspective. And, you know, I know plasma is a little higher than kinda longer term growth. But if we assume plasma is kind of, you know, longer term eight to 10 hospitals, you know, maybe around 10, and then, you know, kind of low single digit declines in in the blood business, you know, does that sort of imply that you're gonna, longer term, you're kinda gonna be at the lower end of that, you know, mid to high single digit, you know, growth target?

Mike Matson
Senior Equity Research Analyst at Needham & Company

So in other words, more maybe more like 6%. Again, I'm talking, you know, post, fiscal twenty six time frame.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yeah, Mike, plan is to issue a new LRP later this calendar year. In fact, we're targeting December, which we think kind of corresponds with a number of things we have underway internally. We've grown this business 10% organically over the four year period of this LRP. We would expect to be able to replicate that performance going forward, knowing that we're doing it off of a much larger and significantly more profitable based business. From our vantage point, we play in winning markets with leading products.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Winning markets are defined as top quartile med tech categories. So the categories themselves are fully supportive of high single digit or better growth rates with the appropriate profitability, that's what we're targeting. And we have some work to do to get our interventional technologies footprint and platform fully on track, that's what you see in our FY 2026 guidance. We want to be balanced, and we're controlling the things we can control and delivering the growth that we aspire to. But what we're building here, and what we'll talk more about in December at our Investor Day, is something that should be better than the numbers you're quoting and significantly more profitable even in the business that we're guiding to today.

Mike Matson
Senior Equity Research Analyst at Needham & Company

Okay, thank you. Look forward to hearing more at the Investor Day then. I guess just want to ask a question on M and A. I think you have an option to acquire VIVUSURE Medical. I know they've made some progress with their trial and I think they got a CE Mark recently for Percucile.

Mike Matson
Senior Equity Research Analyst at Needham & Company

So can you just give us an update there on where things stand, what the timing would be of a potential decision and whether or not your appetite for this business has changed given kind of what you've seen with Vascaid.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yeah. So the long term appetite, the notion that Haemonetics as a serial acquirer doing programmatic M and A to augment robust organic growth, that hasn't changed. It's absolutely part of our long term plan. We think most of that activity will be concentrated in the hospital sectors, particularly IVT. As we step back, we have work to do with our two most recent acquisitions, both Opsense and Atune, and that is our focus and that's why we believe organic growth is the single most powerful lever in our capital allocation today, and that's going to be our focus through the duration of FY 2026.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

The opportunity for VIVUSURE, the option we have there is the one exception. And we've worked very closely with the company over the last several years. We were delighted to see the results from the PATCH trial, the readout at TCT, physician response to that and their progress across all real the main milestones that we've been working with them on. So that is on track. We're optimistic about it.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

It will come out assuming success with our U. S. Filings later this fiscal year, that's powerful. And it would be in our sweet spot, which is the intersection between closure and structural heart, which are the two segments we play in on IBT. So we're enthusiastic, appreciative that it will be a later fiscal twenty twenty six opportunity because it gives the time needed to really get our feet under us in IVT more broadly, and be ready for that product when it comes.

Mike Matson
Senior Equity Research Analyst at Needham & Company

Okay, got it, thanks.

Operator

Thank you, one moment for the next question. And the next question will be coming from the line of Andrew Cooper of Raymond James. Your line is open.

Andrew Cooper
Andrew Cooper
VP - Equity Research at Raymond James Financial

Hey everybody, thanks for the time. Maybe first, just to start on interventional again, it sounds like the smaller bore, Vascaid product might have gotten a little bit worse, not necessarily better in the quarter. So just maybe help us think about where you are in effectuating some of the changes that you started talking about last quarter and how we think about sort of the pacing of that improving through the course of fiscal twenty six.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yeah, thanks Andrew, it's Chris. We like the opportunity in vascular closure writ large. It's a billion dollar plus play and it's as our table showed, we think it's one third EP and two thirds coronary and peripheral predominantly in the interventional cardiology suite. We're having a lot more success in electrophysiology and we need to replicate that as we've kind of refocused and deliver as well on the much larger but smaller growing two thirds that is in IC. From our vantage point, what we've done is just take a step back with the field force.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We experimented with this with our incentive comp and we've now put those changes in place structurally to have a team that is dedicated to vascular closure and covers it across the entire spectrum. We think one of the primary benefactors of that focus will be base cascade. It's approximately 15%, one-five percent of the current revenues, but and it is admittedly growing low single digits as category, but the penetration is relatively modest. And we think we have the best technology and time spent with that physician community educating them on the benefits of what Vascaid brings to them, we think will yield results. We actually have a forecast, which I is very balanced, a modest return to growth for Vascaid in FY twenty twenty six.

Andrew Cooper
Andrew Cooper
VP - Equity Research at Raymond James Financial

Okay, that's helpful. And then maybe just on the P and L, in the quarter, I think you were a little above at least where we were and I think where the rest of the street was on operating expenses, you were better on gross margins to offset that, but just want to drill in a little bit on the OpEx. Was there anything kind of one time ish that jumps out there and how do we think about that trajectory knowing, in the context of what you just said, you're building out this sort of separate team in Structural Heart and kind of some of the other moving parts that you're looking to reinvest in for the Corp?

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Yes, Andrew, it's James. No, there's nothing in particular one time related in OpEx. I think it's just more some timing of expenses in our fourth quarter. We'll probably see some of that continue into first quarter. I think our first quarter is a little bit heavier.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

It's just the pattern of our expense spending even maybe with some R and D. So you should expect our first quarter twenty six to be a notch down, take out the benefit from CSL, is about 100 basis points and then take it down a little bit from there, but nothing remarkable in Q4. Yes. If I can just add to it, Andrew, we think we'll begin as the year progresses to see operating leverage through the P and L. However, we're not backing off of our investments in R and D.

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

Want to I guess I would say different. We want to drive reach and relevance. So the investments we've already made in sales and marketing, the investments we are continuing to make in R and D to strengthen the clinical evidence are absolutely part of what we're doing. We want to be cognizant of it. We have growth targets and margin expansion that we're going to deliver, but we're not going to do that at the expense of under clubbing it with regards to innovation or with our field presence.

Andrew Cooper
Andrew Cooper
VP - Equity Research at Raymond James Financial

Okay, I'll hop back in the queue. Thank you.

Operator

Thank you. One moment for the next question. And the next question is coming from the line of Joanne Wuensch of Citi. Your line is open.

Joanne Wuensch.
Joanne Wuensch.
Managing Director at Citi

Good morning and thank you for taking the question. I have two. I'll just put them upfront. Can you talk a little bit about how you see the year sort of shaking out in terms of revenue and EPS progression. The language I heard on the call was that Plasma would likely be a little bit more back half weighted, which what I assume would be would sort of shift everything into the back half, but I wanted clarification on that.

Joanne Wuensch.
Joanne Wuensch.
Managing Director at Citi

And then your comments on Plasma was that the growth that is coming this year is mostly from share gains. Is there any way for you to like flush that out for us a little bit more in terms of share gains? I'm giving examples here. Because we added sales force, because of a competitor's issue. I'm trying to get my head around where those gains are coming from.

Joanne Wuensch.
Joanne Wuensch.
Managing Director at Citi

And thank you.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Thank you, Jo Anne. Let me start with the guidance and kind of how we're thinking about the quarterly progression. We think on balance, our guidance is balanced. There's things that are beyond our control. We want to be mindful of that.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Collection volumes is still a very large assumption in our overall forecast and we're going to exercise conservatism about what we believe with regard to customer demand and we'll build from there. Even in our hospital based business, there is a second half load. Some of that is just reflective of the double digit growth rate and how things progress quarter to quarter. Some of it's the ongoing work and the focus that we're applying to interventional technologies. So both our revenue and our margin expansion will progress over the course of the year, first half versus second half, pretty much as you described it.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

With regards to plasma, we do have the annualizing of the benefits of the upgrades that have already happened. The entire U. S. Collection volume is now being done with Persona and increasingly with our Express Plus speed technology. So that benefit is there, it will annualize as the year progresses.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Where we see the share gains very notably is both with our two largest collectors, which is Grifols and BioLife Takeda. And we have entered into new extended agreements with both. And as part of that, we are converting competitor centers to our technology. It comes with the full benefit of Persona and Express Plus fully integrated, etcetera. And so that is both margin and volume accretive to us, and part of what's driving the mix that James described earlier.

Joanne Wuensch.
Joanne Wuensch.
Managing Director at Citi

Thank you.

Operator

Thank you. One moment for the next question. And the next question is coming from the line of Anthony Petrone of Mizuho Financial Group. Please go ahead.

Anthony Petrone
Anthony Petrone
Managing Director at Mizuho Financial Group

Thanks. Maybe on Vascade, if we dig into the 28% XL, maybe if you could walk through a little bit where XL is penetrated across the 600 top EP sites. And then if you could give any update on timing on the reconfigured franchise catheter on the XL side, where that is in terms of regulatory and when that's going to be out there in the marketplace? And I'll have a follow-up. Thanks.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Thank you, Anthony. So we look at where the leading PFA players are. We look at where the overall EP procedures are. Some of that's captured in the table. The market's roughly 60% penetrated as we estimate it with PFA for those T600 and we are in 85% of those Anthony.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

And so the focus increasingly is on driving utilization within the converted accounts both for and for RF etcetera. So it's a utilization game for us going forward. It's different and the opportunity set is different. The TAM is fantastic, right? The market is only half penetrated from a utilization perspective.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Fully half the procedures are done not using an advanced closure device. When they use advanced closure, 80% of the time they use us. We want to hang on to that, but obviously drive the utilization and the further penetration. That's what's going to be the story for both MVP and MVP XL for the year to come. And again, we remain bullish on it.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We think it's a really good opportunity. We just want to be calibrated. So we get asked a lot, what does this mean in terms of your opportunity? That's what's captured in the tables. We take the growth rate and procedures, and we take whatever changes are factoring through by the change in treatment modality to understand how many access sites that's creating and what that means for us.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

And what you see here is an EP, that's roughly an 8.5% growth rate this year, which we intend to best pretty significantly.

Anthony Petrone
Anthony Petrone
Managing Director at Mizuho Financial Group

Great. And then the French size catheter regulatory timing, when that's going to be out there. And then on plasma, you look at the 11% to 14% underlying, and just the complexion of that, CSL rolling off new contracts coming in. Maybe just a little bit on how do we think about plasma divisional margins, just given that shift? Thanks.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Sure. So on the French sizes, we have the XL product in the market. We took a close look at it, did that on a PMA, we've gone back in the clinic, we are completing a fairly extensive trial that we think will not only expand the indication in all likelihood up to 16.5 or 17 French OD, but it will also strengthen the label. We have an excellent label, but there's an opportunity to make it better given how the markets evolved with PFA. So we want to do the clinical work.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

It's hard to comment on the timing just given so much of that's dependent upon regulatory review and approval, Anthony. But we're very bullish on the product. There are no changes to the product. We don't need to reengineer anything or do any additional development work. It's all clinical to produce the evidence that'll strengthen that label and solidify our leadership in the space.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

That's not just a US phenomenon, that's a global phenomenon, Europe and Japan include it with different timelines for each. But that's how we're playing across the expanded indication. With regards to plasma, from our vantage point, we're just getting back to that leadership position, the growth that we see, it'll be international increasingly so. There's a really strong demand outside The U. S.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

There's actually been an inversion of cost per liter to collect, where now we're seeing the European markets are favorable on a cost per liter basis to The US, and that's a big source of where we're seeing the share gains that we're experiencing and banking on again in FY twenty six. So what that means, because essentially all of it is nexus, and most of that is nexus with Persona, is the margin profile of the plasma business is significantly better and more sustainable than it ever has been. We were targeting in the LRP that we would push into the low 50s. We are doing better than that, and you see that in our gross margin line, you see it in our fourth quarter, for example, and you see it in our guide for fiscal twenty six. So we expect the plasma business, Source Plasma, to be kind of a mid-50s gross margin going forward.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

There's some moving parts there that have to happen depending on the mix, but we're really bullish. In fact, I'd just shout out to that team. At this point, three years into the LRP, they have met or exceeded every long range plan target we've given them, including some pretty audacious ones. And so kudos to that team for delivering, We're in the place we want to be in the market and we have potential. And if the market recovers faster and more robustly in terms of collection volume, we're in a great position to capitalize on that.

Mike Matson
Senior Equity Research Analyst at Needham & Company

Thank you.

Operator

Thank you. And our next question will be coming from the line of Michael Petusky of Barrington Research.

Mike Petusky
Research Analyst at Barrington Research Associates

Hey, good morning. Quick one for James and then probably one for Chris. James, just sort of given some of the commentary around how the year may play out. I mean, would it be wise to model sort of a negative earnings comp in Q1 versus the comparable period a year ago?

James D'Arecca
James D'Arecca
Executive VP & CFO at Haemonetics

So I'm just trying to think. I don't think it would be negative. It's probably more flattish to slightly positive. I don't think it would be negative.

Mike Petusky
Research Analyst at Barrington Research Associates

Okay. All right. Great. Thanks. That's super helpful.

Mike Petusky
Research Analyst at Barrington Research Associates

And then, Chris, forgive me if I missed this, lots of reports this morning. But did you guys give a revenue figure for the sensor guidewires and esophageal protection businesses? You've given that sort of in past calls and I may have missed it on this one. Did you guys give a revenue figure for Q4?

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We don't, Mike. It's such a small category, not unimportant, but small and therefore just really subject to quarter over quarter vagaries. What I will say about the Guidewire business, really impressive rate of new account openings. In fact, opening twice as many new accounts in the fourth quarter as we did in the first quarter, and that's not an aberration. We expect that rate of growth to continue.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Perhaps even more importantly, the retention rate of those new account openings is approaching 100%, which means that everybody that we opened in the quarter is open and using the product and obviously moving the needle on utilization. So I talked about green shoots, that's the evidence behind the green shoots. We really think with the dedicated effort, we've got Savvy Wire on its way. It's really important therapy for our participation in structural heart. Unfortunately, we've had headwinds from the OEM business that have largely offset that.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We're addressing it. We're cautiously optimistic, trying to be balanced in what we forecast going forward. But there's a role for that product in the market, and we think we're the natural owners to help drive it.

Mike Petusky
Research Analyst at Barrington Research Associates

I heard sort of the bullish commentary around expectations for vascular closure, hemostasis management, transfusion. I mean, what would be your expectation? Mean, growth? Is modest growth possible in '26?

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Which category in particular, Mike?

Mike Petusky
Research Analyst at Barrington Research Associates

Either guidewires or esophageal protection or combined.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yes, we're basically calling that flat in an effort to be balanced about this on a year over year basis that may look very different from one product range to the other. The reality is we think Enzo ETM is an outstanding product for use in RF ablations. We need to see is whether our original assumptions that RF is able to retain a sizable portion, call it 25% to 35% of the ablation market. If that's the case, then we have the opportunity to participate pretty robustly there and we'll be right back on track with Enzo ETM. In the interim, it's very demoralizing for a team to go out, do all the heavy lifting, get a new account, convert it, they're using it, you're having great experience, and then the account flips over to PFA and you lose all the opportunity.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We've largely pulled back from that conscious decision and reprogrammed that team to drive closure, which is our mainstay and where we have to win, as we watch and see how the RF market plays out. We remain cautiously optimistic about that, but it's going to be a longer term play and it's not going to materialize meaningfully in FY twenty six given the PFA adoption curve.

Mike Petusky
Research Analyst at Barrington Research Associates

Okay, terrific. Thanks.

Operator

Thank you. And our next question will be coming from the line of Craig Bajou of Bank of America Securities. Your line is open.

Craig Bijou
Equity Research Analyst at Bank of America Securities

Good morning. Thanks for taking the questions. Two for me. One, just a follow-up on the share gains that you expect in plasma. And Chris, I guess the question is, I heard your comments on the contracts.

Craig Bijou
Equity Research Analyst at Bank of America Securities

So how I guess your line of sight into those share gains and would you characterize those as your known share gains because of the contracts? Or is there still some other work you need to do to win share during the year?

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yes. So it's known share gains given the contract. The only question will be relative timing. And we're cautiously optimistic about the timing. We don't control that.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Our customers do clearly, But they want to collect on the best technology. That's NexSys with Persona. So there's a strong incentive for them as they try to manage down their cost per leader, increase their donor attraction and retention. NexSys is the answer for that. So we're very confident that we get the share.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

The exact timing of it first half, second half is beyond our control, Craig. So we're going to be balanced in how we think about that. The other thing is I would just call out, the quality of the relationships with those leading collectors, the clinical work that we have underway on our next generation technology is better than it ever has been. And I think is building excitement to get centers that aren't yet on that technology on it, so they have the opportunity to grow as we advance our innovation.

Craig Bijou
Equity Research Analyst at Bank of America Securities

Got it. That's helpful. Thanks, Chris. And on just hospital growth expectations for 2026 and the components there, I know you gave a lot of detail in the script and you've provided some other comments. But I guess just if it would be possible to kind of walk through some of the components, Vascade, MVP and XL, and then even maybe the international side, which obviously contributed to growth in Q4.

Craig Bijou
Equity Research Analyst at Bank of America Securities

But I think you said, just given the tougher comp, it may be a little bit less of a contributor in '26 and then some of the blood management technologies to the growth there, if you can.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Yeah, let me give it a shot. So we look at that hospital guidance, again balanced given dynamic market. We're currently expecting it's going to be roughly evenly split in terms of growth contribution between IVT and BMT. Within those, look, we're clearly a function of our key products as I said in the prepared market. In IVT, it's about closure, right?

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We care about the acquired products, we're going improve our performance against those, but it's about closure and it's about closure here in The U. S, which is by far our largest opportunity. So that is the focus, that's the intent in terms of some of the restructuring we've done. We do care about the international growth. We called out the contribution that for example in Japan.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

Japan is getting ready to undergo change to PFA and we're going to be watching and hopefully participating in that as it progresses, but it's difficult to call from where we are. So we've exercised some caution there for sure on a year over year basis. Within Blood Management Technologies, there's a valid tag, right? We're going to see some good opportunities in transfusion management beyond this. They've contributed nicely and will continue to do so.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

May have some headwinds in cell salvage that will negate some of that, but it really comes down to TEG and it comes down to TEG both in The U. S. And in Europe. And one of the things we're really excited by is introducing the global heparinase neutralization cartridge to Europe. It's with TUV for review and approval.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We don't know the exact timing. So again, we're going to exercise caution. But with that approval, we would expect Europe to join The U. S. In terms of rapid conversion of the TEG-five thousand accounts driving greater utilization, a really market leading site of care device that makes the viscoelastic testing much more convenient and much more front of mind for our practitioners, which is what's fueling our growth in The States and it'll fuel Europe as well.

Christopher Simon
Christopher Simon
CEO, President & Director at Haemonetics

We need it because there's an offset in China where for all the reasons you're hearing from everybody else, it's just a disruptive market. So we're not anticipating much from China in fiscal twenty twenty six. So we need to offset it with our performance here in The States and in Europe as well.

Craig Bijou
Equity Research Analyst at Bank of America Securities

Thanks, guys.

Operator

Thank you. That does conclude today's conference call. Thank you for participating. You may all disconnect.

Executives
    • Olga Guyette
      Olga Guyette
      VP - Investor Relations & Treasurer
    • Christopher Simon
      Christopher Simon
      CEO, President & Director
    • James D'Arecca
      James D'Arecca
      Executive VP & CFO
Analysts

Key Takeaways

  • Strong Q4 FY25 earnings with total revenue of $1.4B (4% reported / 8% organic ex‐CSL & divestiture) and robust margin expansion (Q4 adj. gross margin 60.2%, adj. operating margin 24.9%).
  • Hospital segment growth: Blood Management Technologies revenue +6% in Q4 driven by rapid TEG-6s adoption, and Interventional Technologies grew 21% led by 28% growth in Bascade MVP & MVP XL devices.
  • FY26 guidance calls for reported revenue to decline 3%–6% due to CSL transition and divestiture headwinds, but organic ex‐CSL growth of 6%–9% is expected from plasma (11%–14% ex‐CSL) and hospital (8%–11% reported/organic) businesses.
  • Free cash flow and capital returns: FY25 FCF rose 24% to $145M (63% conversion), a new $500M share repurchase program was authorized, and FY26 FCF is forecast at $160M–$200M with >70% conversion.
  • Leadership and strategic moves: Roy Galvin promoted to CCO, Frank Chan hired as COO to scale hospital franchises, and potential M&A in IVT (e.g., VIVUSURE Medical option) following positive clinical results.
AI Generated. May Contain Errors.
Earnings Conference Call
Haemonetics Q4 2025
00:00 / 00:00

Transcript Sections