DENTSPLY SIRONA NASDAQ: XRAY reported second-quarter 2026 revenue of $898 million, down 4.1% on a reported basis and 6.3% on a constant-currency basis, as the dental products company continued its turnaround plan amid lower volumes in several businesses and distributor inventory reductions in Europe.
Excluding the impact from Byte and an approximately $8 million planned reduction in dealer inventory, constant-currency revenue declined 3.6%, Executive Vice President and Chief Financial Officer John Fortson said on the company’s earnings call. Fortson, who joined Dentsply Sirona on July 20, made his first appearance on the company’s quarterly call.
Adjusted earnings per share were flat year over year at $0.52. The result included a $0.17-per-share benefit from $44 million in tariff refunds. Adjusted EBITDA margin was approximately flat, as the refunds offset lower gross profit tied to reduced volume, product mix and incremental tariffs.
Cash flow improves as company repurchases shares
Operating cash flow increased to $99 million from $48 million a year earlier, driven primarily by the tariff refunds and improvements in working capital management, including accounts payable and inventory. Dentsply Sirona ended the quarter with $239 million of cash and cash equivalents and a net debt-to-EBITDA ratio of 3.2 times, unchanged from the first quarter.
The company repurchased 1.3 million shares during the quarter at an average price below $10 per share, representing approximately $12 million of repurchases. Fortson said it was Dentsply Sirona’s first share repurchase since the third quarter of 2024, while adding that debt reduction remains a priority.
Operating expenses rose $12 million year over year, including an approximately $8 million foreign-exchange headwind. Lower general and administrative spending was offset by planned investments in sales, marketing and research and development under the company’s 24-month Return-to-Growth action plan.
Segment results reflect uneven regional demand
- Connected Technology Solutions: Sales totaled $239 million, down 1.5% as reported. Equipment and instruments revenue was flat, with treatment-center declines partly offset by imaging growth, particularly for Orthophos products in Europe, the Middle East and Africa. CAD/CAM revenue declined by the mid-single digits, reflecting lower Americas volumes and unfavorable price mix in EMEA, partly offset by double-digit growth in Asia-Pacific.
- Essential Dental Solutions: Sales were $376 million, down 2.7% as reported, primarily due to lower volumes in the Americas and EMEA. The company said certain European distributors reduced inventory levels, affecting sell-in results, though it said regional sell-out grew at a low-single-digit rate and did not view inventory reductions as demand-driven.
- Orthodontic and Implant Solutions: Revenue fell 13.2% as reported to $197 million. Excluding Byte’s year-over-year impact, the segment declined 5.7%, consistent with the prior quarter. Implant sales declined by the mid-single digits, with lower premium implant volumes in the Americas and Asia-Pacific partly offset by mid-single-digit implant growth in EMEA, led by the MIS value implant brand. SureSmile revenue of $40 million declined by double digits, primarily in the Americas.
- Wellspect Healthcare: Revenue increased 7.1% as reported to $86 million, supported by new-product sales, geographic expansion and adoption of newer offerings, partly offset by lower U.S. inventory levels.
Chief Executive Officer Dan Scavilla said some providers in EMEA deferred capital-equipment investment decisions amid uncertainty related to the Middle East conflict. He also cited increased freight costs associated with the regional disruption, though he said the company has absorbed those costs to date and has not reduced planned investment in sales, clinical education or innovation.
Guidance maintained, with improvement expected later in year
Dentsply Sirona maintained its 2026 outlook for net sales of $3.5 billion to $3.6 billion and adjusted EPS of $1.40 to $1.50. The EPS range excludes both tariff refunds and the effect of incremental tariffs. Management said the original outlook did not assume tariff refunds.
The company expects third-quarter revenue to decline sequentially because of normal seasonality. It also expects third-quarter earnings to be below second-quarter levels when excluding the $0.17 tariff-refund benefit. Management expects the benefits from increased spending on its sales force, clinical education and R&D to become more visible beginning in the fourth quarter.
Scavilla said the company’s recovery remains a turnaround rather than a linear improvement. He said Dentsply Sirona is prioritizing the U.S. market, where it has reorganized its commercial structure, expanded its dealer network and retrained implant sales representatives. The company recently expanded partnerships with Atlanta Dental and Nashville Dental in the U.S. and Medline Sinclair in Canada.
Management said newly added capital-equipment dealers require time for training, pipeline development and sales execution, with a more meaningful contribution expected in the fourth quarter. Scavilla also said the company expects to exit the year with positive growth in the U.S., while broader participation in market growth is expected to be more of a 2027 development.
On innovation, Scavilla said incremental R&D investment is intended to accelerate digital dentistry capabilities on the DS Core platform, including implant and orthodontic workflows. He said some initiatives could reach the market in late 2027, subject to regulatory approvals, with broader impact potentially extending into 2028.
About DENTSPLY SIRONA (NASDAQ:XRAY)
Dentsply Sirona Inc NASDAQ: XRAY is a leading global manufacturer of professional dental products and technologies. The company, formed through the merger of Dentsply International and Sirona Dental Systems in February 2016, brings together a long heritage of innovation in dental care. Headquartered in Charlotte, North Carolina, Dentsply Sirona develops and markets a comprehensive range of dental consumables, laboratory products, and advanced imaging and CAD/CAM systems.
The company's product portfolio spans preventive, restorative, orthodontic, endodontic and surgical care.
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