Globus Medical, Inc. GMED used its second-quarter 2026 call to emphasize margin execution and continued spine share gains, while management flagged Nevro and Enabling Technologies as risks within the second-half outlook.
GMED’s second-quarter Non-GAAP EPS of $1.34 beat the $1.12 Zacks Consensus Estimate. Revenues of $789.61 million also topped the $786.86 million estimate.
The company raised full-year 2026 non-GAAP EPS guidance to $4.95-$5.05 from $4.70-$4.80 but kept revenue guidance at $3.18-$3.22 billion.
GMED Leans on Spine Share Gains
Keith Pfeil, president and CEO, said second-quarter revenues grew 6% as reported and 9% excluding Nevro, led by 7% U.S. Spine growth and 14% International Spine growth.
Pfeil said competitive recruiting, robotics pull-through and product launches continued supporting U.S. Spine. Competitive hires doubled from the first quarter.
Kyle Kline, CFO, called U.S. Spine's result its fifth consecutive quarter of above-market growth and said management is targeting sustained double-digit International Spine growth in the second half.
Globus Medical Converts Margin Gains Into Higher Guidance
Adjusted gross margin reached 69.4%, up 200 basis points year over year, supported by fixed-cost leverage, favorable mix and manufacturing and supply-chain initiatives.
Adjusted EBITDA margin rose to 35.4% from 28.0%. Kline linked the higher earnings outlook to first-half margin expansion and operating leverage.
Kline reiterated a 69%-70% adjusted gross margin range for 2026 and said the company expects to reach the low 70s by year-end. Pfeil said management remains confident in returning to the mid-70s in 2027.
GMED Keeps Revenue Outlook Measured
A Jefferies analyst asked whether management favored any point inside the full-year revenue range. Kline declined to narrow it and identified Enabling Technologies and Nevro as downside risks.
A Piper Sandler analyst asked why Globus Medical did not raise revenue guidance. Kline said management preferred to remain cautious because of the Enabling Technologies strategy shift and the work still required to stabilize Nevro.
A BMO analyst pressed on U.S. Spine growth. Pfeil said second-half comparisons become more difficult, but management remained confident in the business.
Globus Medical Reworks Enabling Tech for Pull-Through
Enabling Technologies revenues fell 25.8% to $26.1 million as Globus Medical continued shifting toward flexible capital-acquisition options beyond outright purchases.
Pfeil said deployed ExcelsiusGPS and ExcelsiusHub units, whether sold, leased or rented, increased 11% sequentially and 25% year over year. He characterized 2026 as a transition year.
In Q&A, Pfeil also said the objective is to place capital systems and then generate implant, disposable and service revenues after customers are trained and utilization builds.
GMED Targets Nevro Recovery by Late Q4
Nevro revenues declined 14.3% year over year in the second quarter and slipped $1.7 million sequentially, while stand-alone adjusted EBITDA margin improved to 22.4% from negative 1.4%.
Roughly 75% of open sales roles were filled during the quarter. Management expects trial volumes to improve through the second half and return to historical levels late in the fourth quarter.
Asked by a Truist analyst about Nevro's cadence and M&A, the CEO said the immediate focus is stabilization and a return to growth, with no specific Nevro M&A commentary.
Globus Medical Keeps Innovation and Capital Discipline Central
Pfeil said Globus Medical has more than 60 product-development projects underway and plans to launch its patient-specific SCRIPT lumbar spacer and rod systems later in the third quarter.
Kline said R&D spending should rise in the second half as the company adds development resources, while full-year R&D remains targeted at 5%-6% of net sales.
He said capital allocation continues to prioritize internal product investment, share repurchases and complementary M&A. Globus Medical repurchased $136.1 million of stock in the quarter.
GMED Balances Execution With Transition Work
Management's tone combined confidence in spine growth and margin execution with caution around businesses still being reset. The unchanged revenue range reflects that balance.
Pfeil and Kline kept the longer-term focus on product development, sales-force expansion and disciplined capital use, while Nevro and Enabling Technologies remain execution priorities.
Globus Medical's Zacks Signals Stay Mixed
GMED currently carries a Zacks Rank #3 (Hold), with a Growth Score of A, Value Score of B, Momentum Score of D and VGM Score of B. The A and B grades are favorable style readings, while the D Momentum Score is weaker.
Zacks Style Scores complement the Rank, with the strongest combinations pairing a Zacks Rank #1 (Strong Buy) or 2 (Buy) with A or B Style Scores. GMED currently has a #3 rank, which can change as earnings estimates are revised after the just-reported results.
You can see the complete list of today’s Zacks #1 Rank stocks here.
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Globus Medical, Inc. (GMED): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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