Zimmer Biomet Q1 2025 Earnings Summary

Zimmer Biomet reported first quarter 2025 net sales of $1.909 billion, a year-over-year increase of 1.1% as reported, and 2.3% on a constant currency basis. Net earnings were $182 million ($0.91 per diluted share), while adjusted net earnings were $361 million ($1.81 per diluted share). U.S. sales grew 1.3%, while international sales rose 3.7% on a constant currency basis.
The strongest growth came from the S.E.T. (Sports Medicine, Extremities, Trauma) segment, which grew 4.9% on a constant currency basis. Hips grew 2.4%, and Knees increased 1.9%. Technology & Data, Bone Cement, and Surgical declined by 3.5%.
Zimmer Biomet updated its full-year 2025 guidance:
• Reported revenue growth revised upward to 5.7%–8.2% (previously 1.0%–3.5%), including Paragon 28 acquisition and currency impact.
• Adjusted EPS revised downward to $7.90–$8.10 (previously $8.15–$8.35), incorporating tariffs and other adjustments.
• Organic constant currency revenue growth remains at 3.0%–5.0%.
Highlights:
• Completed acquisition of Paragon 28 to expand in the high-growth foot and ankle market.
• Showcased key innovations at AAOS 2025, including the Z1™ Hip System and Oxford® Cementless Partial Knee.
• Launched a new awareness campaign with Arnold Schwarzenegger.
• Named one of the 2025 World’s Most Ethical Companies by Ethisphere.
• Adjusted gross margin was 71.5% (down from 72.9% in Q1 2024).
• Free cash flow improved significantly to $278.5 million (from $90.9 million).
• Net debt rose slightly to $5.79 billion, reflecting funding for the Paragon 28 acquisition.

Zimmer Biomet Completes Acquisition of Paragon 28 to Strengthen Foot and Ankle Segment


Zimmer Biomet Holdings, Inc. has finalized its acquisition of Paragon 28, a leading foot and ankle orthopedic company, reinforcing its presence in one of the fastest-growing musculoskeletal markets. The transaction enhances Zimmer Biomet’s specialized portfolio and leverages Paragon 28’s focused commercial channel, positioning the company for expanded reach in the $5 billion foot and ankle market. As part of the deal, Paragon 28 shareholders received $13 per share in cash and a contingent value right (CVR) of up to $1 per share. Paragon 28 is now a wholly owned subsidiary, and its shares have been delisted from the NYSE.

Zimmer Biomet Holdings, Inc. announced that Chairman of the Board Christopher Begley will retire at the 2025 Annual Meeting due to the company’s mandatory director retirement policy. The Board has appointed President and CEO Ivan Tornos as the new Chairman, effective May 29, 2025, the day of the Annual Meeting. Additionally, Michael Farrell will assume the role of Lead Independent Director. The Board will reduce its size to ten members following Begley’s departure.

source: Zimmer Biomet Holdings, Inc., February 25, 2025.

Zimmer Biomet Holdings, Inc. (NYSE: ZBH) announced the completion of its previously disclosed issuance of $1.75 billion in senior notes. The offering includes $600 million of 4.700% notes due 2027, $550 million of 5.050% notes due 2030, and $600 million of 5.500% notes due 2035. The proceeds from this issuance will support the company's financial strategy and general corporate purposes.

The notes were issued under a supplemental indenture dated February 19, 2025, as part of Zimmer Biomet’s existing indenture agreement. Interest payments will be made semi-annually, with redemption provisions allowing the company to repurchase the notes before maturity under specific conditions.

Additionally, Zimmer Biomet reaffirmed its planned acquisition of Paragon 28, Inc. If the merger is not completed by the specified deadline, the company will be required to redeem the 2030 and 2035 notes at a special mandatory redemption price of 101% of their principal amount, plus accrued interest.

This financing move aligns with Zimmer Biomet’s long-term growth strategy as it continues to expand its portfolio and strengthen its financial position.

Zimmer Biomet Holdings, Inc. has announced a public offering of $1.75 billion in notes under an underwriting agreement with Goldman Sachs, Barclays, Citigroup, Morgan Stanley, and SMBC Nikko. The offering consists of $600 million in 4.700 percent notes due 2027, $550 million in 5.050 percent notes due 2030, and $600 million in 5.500 percent notes due 2035. These notes will be issued under a twelfth supplemental indenture to the company's 2009 base indenture, with Computershare Trust Company, N.A. serving as the trustee.

The company intends to use the proceeds for general corporate purposes, including the repayment or retirement of its 3.550 percent notes due 2025. Interest on the newly issued notes will be paid semi-annually on February 19 and August 19, beginning on August 19, 2025. The transaction is expected to close on February 19, 2025, pending customary closing conditions.

A notable feature of the 2030 and 2035 notes is a special mandatory redemption clause tied to Zimmer Biomet’s pending acquisition of Paragon 28. If the merger is not completed by the deadline, the company will be required to redeem the notes at 101 percent of their principal amount.

The underwriters, who are receiving customary fees, may also hold positions in Zimmer Biomet's existing debt. The company included forward-looking statements in its filing, cautioning about risks and uncertainties that could impact the offering and its final terms.

Zimmer Biomet reported solid financial results for the fourth quarter and full year of 2024, with growth in both sales and earnings. Fourth quarter net sales reached $2.023 billion, a 4.3% increase (4.9% on a constant currency basis), driven by strong performance across key product lines. Diluted earnings per share (EPS) for the quarter were $1.20, while adjusted diluted EPS rose to $2.31, reflecting operational efficiency and effective cost management. For the full year, net sales grew 3.8% (4.8% on a constant currency basis) to $7.679 billion, with diluted EPS of $4.43 and adjusted diluted EPS of $8.00, demonstrating consistent growth and profitability.

Looking ahead, Zimmer Biomet provided financial guidance for 2025, signaling confidence in its ability to sustain growth and deliver value. The company’s performance in 2024 was supported by innovation, strategic investments, and a focus on improving operational efficiency. With a strong foundation and a clear growth strategy, Zimmer Biomet is well-positioned to continue its momentum in the medical technology sector.