Smith & Nephew SNATS (NYSE:SNN) Announces Quarterly Earnings Results, Misses Estimates By $0.46 EPS

Key Points

• Smith & Nephew missed quarterly expectations: EPS was $0.48 versus the $0.94 consensus, while revenue of $1.55 billion fell short of the $1.64 billion estimate.
• Growth outlook was reduced: Second-quarter underlying growth was 1.6%, prompting management to lower its 2026 revenue-growth forecast to about 4%, mainly because of weakness in U.S. Orthopaedics and Advanced Wound Bioactives.
• Profitability and cost controls remained resilient: Trading profit increased 9% excluding M&A, margins expanded to 18.3%, and stronger-than-expected savings led the company to raise its 2026 savings target to $200 million.

Smith & Nephew SNATS (NYSE:SNN - Get Free Report) issued its earnings results on Tuesday. The medical equipment provider reported $0.48 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.94 by ($0.46), FiscalAI reports. The company had revenue of $1.55 billion for the quarter, compared to analyst estimates of $1.64 billion.

Here are the key takeaways from Smith & Nephew SNATS's conference call:

• Revenue growth fell short of expectations, with Q2 underlying growth of 1.6% and the full-year 2026 outlook reduced to around 4%, primarily due to weakness in U.S. Orthopaedics and Advanced Wound Bioactives.
• Despite the revenue shortfall, trading profit rose 9% excluding M&A to $566 million, with margin expanding 60 basis points to 18.3%. The company maintained its guidance for approximately $1.3 billion of 2026 trading profit, around $800 million of free cash flow, and ROIC above 10%.
• Sports Medicine and ENT remained a major growth engine, increasing 8.6% on broad-based demand for products including REGENETEN, Q-FIX KNOTLESS, Fast Seal, and ENT wands. CORI robotic placements also grew by double digits, alongside improving utilization and penetration.
• U.S. Orthopaedics remains the key operational weakness, particularly knees, where the company lacks a cementless offering across part of its installed base. Management expects improvement from LEGION MS and the LANDMARK Porous launch, while U.S. hip growth was temporarily slowed by Catalyst Stem instrument-set deployment delays.
• Efficiency savings significantly exceeded expectations, reaching about $133 million in the first half and prompting the company to raise its 2026 savings target from $150 million to $200 million. These savings, along with tariff refunds that broadly offset 2026 tariff costs, are helping protect profitability despite slower sales.

Smith & Nephew SNATS Stock Performance

Shares of Smith & Nephew SNATS stock traded down $1.76 during trading hours on Tuesday, reaching $30.39. The company's stock had a trading volume of 1,235,978 shares, compared to its average volume of 1,181,449. Smith & Nephew SNATS has a one year low of $28.56 and a one year high of $38.79. The stock's fifty day simple moving average is $30.45 and its two-hundred day simple moving average is $32.19. The company has a quick ratio of 1.25, a current ratio of 2.57 and a debt-to-equity ratio of 0.60.

Wall Street Analysts Forecast Growth

SNN has been the topic of a number of research analyst reports. Wall Street Zen raised shares of Smith & Nephew SNATS from a "buy" rating to a "strong-buy" rating in a research report on Saturday, July 4th. Weiss Ratings lowered Smith & Nephew SNATS from a "hold (c+)" rating to a "hold (c)" rating in a research report on Thursday, June 11th. Sanford C. Bernstein set a $31.85 target price on Smith & Nephew SNATS in a research report on Monday, May 11th. Canaccord Genuity Group dropped their price target on Smith & Nephew SNATS from $32.00 to $30.00 and set a "hold" rating on the stock in a research note on Monday, May 11th. Finally, The Goldman Sachs Group reiterated a "buy" rating on shares of Smith & Nephew SNATS in a report on Monday, May 25th. One research analyst has rated the stock with a Buy rating and five have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, Smith & Nephew SNATS presently has an average rating of "Hold" and an average price target of $30.93.

Institutional Investors Weigh In On Smith & Nephew SNATS

Several hedge funds and other institutional investors have recently made changes to their positions in SNN. Arax Advisory Partners lifted its position in Smith & Nephew SNATS by 142.6% in the 4th quarter. Arax Advisory Partners now owns 968 shares of the medical equipment provider's stock valued at $32,000 after acquiring an additional 569 shares in the last quarter. Advisors Asset Management Inc. bought a new position in shares of Smith & Nephew SNATS in the fourth quarter valued at approximately $36,000. Caitong International Asset Management Co. Ltd bought a new position in shares of Smith & Nephew SNATS in the third quarter valued at approximately $41,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC purchased a new position in shares of Smith & Nephew SNATS during the fourth quarter valued at approximately $43,000. Finally, Northwestern Mutual Wealth Management Co. boosted its position in shares of Smith & Nephew SNATS by 105.8% during the third quarter. Northwestern Mutual Wealth Management Co. now owns 1,385 shares of the medical equipment provider's stock valued at $50,000 after buying an additional 712 shares during the last quarter. 25.64% of the stock is owned by institutional investors.

About Smith & Nephew SNATS

Smith & Nephew plc is a global medical technology company specializing in the design, development and manufacture of advanced surgical devices, orthopaedic reconstruction implants, trauma and extremities products, sports medicine solutions and wound care therapies. Founded in 1856 in Hull, United Kingdom, the company has grown through both organic innovation and strategic acquisitions to offer a broad portfolio that addresses patient needs across joint replacement, minimally invasive surgery and wound healing.

In its orthopaedics business, Smith & Nephew provides hip and knee replacement systems, modular joint revision implants and biologic solutions for bone repair.

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