Enovis (NYSE:ENOV), a medical technology company focused on orthopedics and recovery products, announced results for Q2 2025 on August 7, 2025. The headline news was a clear beat on both GAAP revenue and non-GAAP adjusted earnings per share. GAAP revenue reached $564.5 million, up 7% year over year on a reported basis and $10.9 million ahead of forecasts. Non-GAAP earnings per share were $0.79, noticeably above the $0.72 consensus. The company also raised its full-year forecasts for revenue and adjusted profit, with revenue now expected to be in the range of $2.245–2.275 billion and adjusted earnings per share guidance increased to $3.05–3.20. Despite persistent GAAP net losses, the quarter saw solid commercial momentum, new product launches, and a notable performance by the Reconstructive segment.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $0.79 | $0.72 | $0.62 | 27.4 % |
| Revenue (GAAP) | $564.5 million | $554.13 million | $525.2 million | 7.5 % |
| Adjusted EBITDA (Non-GAAP) | $97.2 million | $90.2 million | 7.8 % | |
| Adjusted Gross Profit Margin (Non-GAAP) | 60.5 % | 59.6 % | 0.9 pp | |
| Net Loss (GAAP) | ($36.5 million) | ($18.5 million) | (97.3 %) |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
About Enovis and Its Core Business
Enovis develops and sells medical technologies, focusing on reconstructive implants and prevention and recovery solutions. About 41% of its net sales came from outside the United States in 2024, highlighting the firm’s international reach.
The company’s growth relies on five critical areas: innovation and new product launches, strict regulatory compliance, global expansion, strategic acquisitions, and effective talent management. Its Enovis Growth eXcellence system supports its innovative culture, driving new products and improved patient outcomes. Maintaining compliance with global medical regulations and integrating recent acquisitions is vital to staying ahead in a crowded device market.
Quarter Highlights and Performance Drivers
GAAP sales beat expectations, led by the Reconstructive segment. This segment, which consists mainly of joint replacements and related orthopedic implants, posted $274.0 million in GAAP sales, up 11% reported and 8% organic. The Prevention & Recovery segment, including bracing, bone stimulation, and rehabilitation products, delivered $290.6 million in GAAP revenue, a 5% reported increase. Growth here was slower but still supported by new launches such as Manafuse, an ultrasound-based product for recovery sciences, and new spine bracing technology. Management noted that Recon’s performance was well above the company average, citing “encouraging momentum in new product introductions.”
Profitability metrics showed improvement at the gross margin level on a GAAP basis. Gross margin (GAAP) increased. Adjusted gross margin improved by 0.9 percentage points compared to the same quarter last year. However, the company reported adjusted EBITDA (non-GAAP) of $97.2 million, reflecting a stable adjusted EBITDA margin percentage of 17.2% on higher sales, but was held back by ongoing integration and regulatory costs.
GAAP profitability remained a challenge. Net loss (GAAP) widened to $36.5 million. The most significant were $43.0 million in amortization costs linked to acquisitions, $13.5 million in strategic deal expenses, and $6.6 million of inventory step-up costs caused by recent acquisitions. These adjustments reflect ongoing integration efforts, like the blending of assets from the Lima acquisition. Regulatory costs, such as European Medical Device Regulation (MDR) compliance, added further pressure, including non-recurring costs recognized during the quarter. The company booked $3.2 million for MDR and other regulatory/legal matters.
Year-to-date (first six months of 2025), cash from operations (GAAP) was positive at $46.2 million, compared to a loss a year ago. However, Capital expenditures (GAAP) were $87.6 million for the first six months of 2025. Enovis is investing to support its expanded scale following recent acquisitions and to achieve supply chain and operational synergies. Integration costs are expected to decrease in future quarters.
Strategically, innovation remained central. New products drove sales—especially ARVIS guided surgical technology and the AltiVate shoulder platform in Recon. The Manafuse launch in the Prevention & Recovery segment is aimed at expanding the company’s reach in recovery and rehabilitation. Management also noted the importance of operational discipline and a focus on cross-selling more products in international markets. The company’s leadership shifted during the quarter, though strategic direction appears consistent under the new CEO.
One-time factors also shaped the quarter. The costs from acquisitions and regulatory compliance were again substantial. In addition, the company is facing supply chain and tariff headwinds, particularly in its Prevention & Recovery business. Tariffs could reach up to $40 million in 2025, although the company is working to mitigate this impact through supply chain adjustments. No changes were announced regarding dividends; Enovis does not currently pay a dividend.
Outlook and What to Watch
Looking ahead, management raised its 2025 outlook, updating full-year guidance to revenue of $2.245–2.275 billion, adjusted EBITDA of $392–402 million, and adjusted earnings per share of $3.05–3.20. Full-year revenue is now expected between $2.245 billion and $2.275 billion, up from the prior $2.220 billion to $2.250 billion range. Adjusted EBITDA guidance increased to $392–402 million, with non-GAAP adjusted EPS expected at $3.05 to $3.20 per share (previously $2.95–3.10). The company still expects to generate positive free cash flow.
For investors and observers, several factors will be important in the coming quarters. The pace and effectiveness of integration following the Lima acquisition, the ability to mitigate tariff costs in Prevention & Recovery, and the progression of new product launches all stand out. Watch for improvements in free cash flow as capital expenditures normalize and integration expenses decrease. Changes in pricing environments, supply chain resilience, and success in international expansion will also affect the company’s longer-term trajectory.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
