Orthofix Medical NASDAQ: OFIX reported first-quarter 2026 results that management said reflect steadier execution, improving stability, and the early benefits of actions taken to reset its Spine commercial channel. Total global net sales for the quarter ended March 31, 2026 were $196.4 million, up 3% year-over-year on a pro forma constant currency basis, excluding discontinued M6 product lines, according to Chief Financial Officer Julie Andrews.
Management highlights commercial progress in Spine and distributor network
President and CEO Massimo Calafiore said the company’s first-quarter performance showed “steady execution, improving stability, and sharper strategic focus,” adding that Orthofix began to see “the expected progress from our Spine commercial channel actions” as the quarter progressed.
In Spine, Calafiore said global Spine Fixation net sales grew 6% on a constant currency basis, with U.S. net sales growth of 4%. He attributed results to “enhanced commercial focus, deeper procedural penetration, and the ongoing benefits of our distributor transitions,” noting that the distributor transitions are “now largely behind us.”
Calafiore also pointed to strong performance among the company’s top distributor partners. “Our top 30 distributor partners delivered net sales growth of 27% year-over-year and 24% on trailing 12 months basis,” he said, describing the results as support for Orthofix’s strategy to prioritize larger distributors and deepen relationships with key partners.
During the Q&A, Calafiore told analysts the company plans to extend this approach beyond its top distributors. He said Orthofix has moved past “phase number 1” of its distributor plan and will focus in 2026 on helping the “second tier” of distributors grow using “the same discipline and rigor” applied to the top 30.
Product and portfolio focus: 7D, Virata, and limb reconstruction platforms
Calafiore described the 7D FLASH navigation system as a “core differentiator” that supports precision and workflow and increases surgeon engagement. He said Orthofix is intensifying its commercial focus on adoption of 7D FLASH to support a more integrated Spine offering.
He also said the company remains on track for the full market launch of Virata in the second half of 2026. In response to a question on U.S. Spine growth, Calafiore cited multiple drivers for anticipated acceleration through the year, including annualization of distributor changes and upcoming product launches. He said Orthofix is “on time for the full market launch of the Virata open system and on time on the alpha launch of the Virata MIS,” and expects “a very good strong contribution” from those systems in the second half.
In Limb Reconstruction, Andrews said global net sales were $32.8 million, up 3% in the quarter. U.S. performance was flat, which she attributed “largely due to the timing of OSCAR capital sales.” She said the company restructured its capital sales team and is seeing “a strengthening capital pipeline,” while also seeing continued acceleration in worldwide adoption of TrueLok Elevate and Fitbone. Andrews said Orthofix expects to “return to double-digit growth in the U.S. in the second half of 2026” for the Limb Reconstruction business.
In a separate question on the apparent slowing in U.S. orthopedics/limb reconstruction, Andrews said “the momentum hasn’t slowed,” but cited “transient issues,” including the decision to sunset about 30 product lines last year, which began to impact results in the fourth quarter and continued into the first quarter, along with the timing of OSCAR capital sales.
Therapeutic Solutions and Biologics: growth and actions to improve performance
Therapeutic Solutions (formerly Bone Growth Therapies) posted net sales of $57.8 million, up 5% year-over-year, with Andrews saying the business continued to outperform the broader market. She noted fracture sales grew 6% in the quarter and said Orthofix expects growth to remain above market rates of 2% to 3% due to execution, new surgeon additions, and competitive conversions, “especially in the fracture channel.”
Biologics, meanwhile, was described as an area where the company is applying tighter execution discipline. Calafiore said performance improved sequentially during the quarter as Orthofix implemented targeted actions to expand account penetration and increase utilization across the portfolio. He said the company is “refining our go-forward strategy, building clinical evidence, and supporting advocacy,” with actions intended to position Biologics to exit 2026 with “stronger momentum and a more durable growth profile.”
Asked about expectations for Biologics growth by year-end, Calafiore said Orthofix expects the business “to go back to market growth,” while acknowledging work remains. He clarified that a leadership realignment was driven by experience, stating it was “more a realignment under a leader that is Patrick Fisher,” rather than a broader move under orthopedics leadership.
Andrews said Orthofix does not break out Biologics revenue separately and could not provide the size of the Biologics business, though she pointed analysts to pre-merger results and the company’s quarterly disclosures that include an MTF service fee component.
Financial details: margins, EBITDA, cash, and quarterly factors
Andrews said first-quarter performance included some discrete items. Timing of certain international stocking orders benefited results by approximately $2 million, though she said the “majority of performance reflected underlying execution.” She also noted the quarter had one less selling day than the prior year, reducing growth rates by about 1.6%.
Additionally, a CMS team pilot program that began in January and includes bone growth stimulation had a one-time impact of less than 0.5% on first-quarter growth, Andrews said, below the roughly 1% impact the company had originally anticipated.
On profitability, Andrews reported pro forma non-GAAP adjusted gross margin of 70.7%, a 40 basis point improvement over the prior year, driven by freight and logistics productivity improvements, partially offset by unfavorable geographic mix. Pro forma non-GAAP adjusted EBITDA was $9.7 million, which she said was in line with expectations, reflecting the impacts from geographic mix and commercial transitions.
Orthofix ended the quarter with $120.9 million in total cash, including restricted cash. Andrews said the increase in cash was due to financing activities during the quarter, including a draw on the second tranche of the company’s debt facility.
Guidance reaffirmed; minimal Middle East impact expected
Orthofix reaffirmed its full-year 2026 guidance. Andrews said net sales are expected to range between $850 million and $860 million, representing about 5.5% pro forma constant currency growth at the midpoint. She said the company expects net sales growth of approximately 5% in the first half of the year and about 6% in the second half.
In response to an analyst question on cadence, Andrews said that adjusting first-quarter results for the selling day and the CMS pilot program impact puts the company “right at kind of that 5% growth rate” for Q1. For Q2, she said Orthofix would expect growth “in the 6%, 6% range” to support the first-half outlook.
For profitability, Andrews said non-GAAP adjusted EBITDA is expected to be between $95 million and $98 million, representing roughly 70 basis points of margin expansion at the midpoint. Free cash flow is expected to be positive for the full year, excluding potential legal settlements.
Andrews also addressed geopolitical concerns, saying the company expects “very minimal impact for the full year” related to the Middle East. She said Q1 saw a timing impact in Spine orders in the region, “primarily with orders,” but it was “more than made up for with other stocking orders,” and she said it was not a material factor embedded in full-year expectations.
Calafiore closed the call by reiterating the company’s priorities for 2026: “Deliver quarter by quarter progress, expand margins, generate cash, and translate our innovation and execution into durable shareholder value.”
About Orthofix Medical NASDAQ: OFIX
Orthofix Medical Inc NASDAQ: OFIX is a global medical device company focused on the design and development of innovative orthopedic and spinal solutions. The company's core business is divided into two segments: spine and orthopedics. In the spine segment, Orthofix offers a range of titanium implants, biologics and portable bone growth stimulation devices designed to support spinal fusion, deformity correction and minimally invasive procedures. Its orthopedic segment encompasses products for fracture fixation, external fixation systems, trauma care and sports medicine, providing surgeons with implantable devices and instruments for complex bone reconstruction and healing.
Orthofix's product portfolio includes strut systems, bone growth stimulators, interbody fusion devices and fixation hardware that address various indications such as degenerative disc disease, spinal deformities, non-unions and long-bone fractures.
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