Medacta First-Half Sales Miss Estimates on North America Slowdown

Swiss medical device firm Medacta Group (MOVE) reported first-half revenue that fell short of analyst expectations, citing a significant slowdown in North American growth and weaker-than-anticipated performance in several key product segments.

First-Half Performance Details

In a report released Wednesday, Medacta announced group revenues of €368 million for the first half, missing the consensus estimate of €373 million by 1%. The figure represents a 9.7% increase on a constant currency basis, which was below the expected growth rate of 11.5%.

The company attributed the sales miss to underperformance in its Knees, Spine, and Shoulder/Sports Medicine business lines. In its Joints category, Medacta also noted a general softening within its existing customer base.

Regional and Segment Breakdown

Performance varied significantly across regions, with North America posting the weakest results. The region grew just 6.6% on a constant currency basis, a slowdown the company linked primarily to a sales transition in its U.S. Spine business. In contrast, the Asia-Pacific region grew 13.1%, EMEA expanded by 10.0%, and Latin America saw growth of 16.4%.

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An analysis by product category shows several key segments missed consensus forecasts:

• Knees: Grew 10.8% in constant currency, below the 14.0% estimate.
• Spine: Grew 4.5% in constant currency, versus a 7.7% estimate.
• Shoulder & Sports Medicine: Increased 15.9% in constant currency, significantly short of the 25.0% consensus.
• Hips: Grew 8.1% in constant currency, nearly meeting the 8.6% estimate.

Full-Year Outlook Maintained

Despite the first-half miss, Medacta reaffirmed its full-year guidance. The company continues to forecast constant currency revenue growth between 10% and 14% and an adjusted EBITDA margin expansion of 50 basis points on a constant currency basis.

For investors, this guidance implies a necessary acceleration in the second half of the year. To meet the midpoint of its revenue target, Medacta would need to achieve constant currency growth of approximately 14.3% in the second half.