Orthopediatrics Stock Earnings Reports

OrthoPediatrics reported Q3 2025 revenue of $61.2M, up 12% year-over-year, with underlying strength across Trauma & Deformity (T&D), scoliosis implants and OPSB (specialty bracing/clinics). Management noted that revenue missed internal expectations due to two isolated, lower‑margin items: delayed 7D capital unit placements (zero unit sales in the quarter) and prolonged weakness in Latin America stocking/set sales (primarily Brazil). Excluding 7D capital and LatAm stocking/set sales, global revenue grew ~17% and U.S. revenue grew ~19%. Gross margin expanded to ~74% (vs. 73% a year ago) driven by favorable mix. Adjusted EBITDA improved 56% to $6.2M and free cash flow usage improved materially to -$3.4M (set deployment of $4.1M). The company reiterated full‑year guidance of $233.5M–$234.5M revenue and $15M–$17M adjusted EBITDA, and reiterated the plan to deploy ~$15M in sets for 2025 and to generate positive free cash flow in Q4 2025 with break‑even free cash flow expected in 2026. Strategic highlights: continued clinic expansion of OPSB (26 clinics at acquisition to >40 clinics today, new markets including NYC, California and Ireland), strong early adoption and planned ongoing rollouts of the 3P pediatric plating platform (including recent FDA approval of 3P Small & Mini), momentum with RESPONSE and EOS portfolio additions (VerteGlide limited release), and accelerating international demand in EMEA and APAC while LatAm remains a headwind. Management emphasized a deliberate focus on higher‑margin, capital‑efficient growth (implants, OPSB, agency/replenishment sales), ongoing restructuring to reduce costs (Q3 included $2.3M restructuring and $2.3M impairment charges), and prioritizing profitability and free cash flow over top‑line at all cost.