[First Quarter 2025 and Business Highlights](index=1&type=section&id=First%20Quarter%202025%20and%20Business%20Highlights) OrthoPediatrics reported strong Q1 2025 results with 17% revenue growth, improved Adjusted EBITDA, and raised full-year guidance Q1 2025 Key Performance Indicators (in millions) | Metric | Q1 2025 | Change vs. Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $52.4 | +17% | | U.S. Revenue | $40.9 | +19% | | International Revenue | $11.5 | +11% | | Trauma & Deformity Revenue | $37.9 | +14% | | Scoliosis Revenue | $13.7 | +34% | | Adjusted EBITDA | ($0.4) | Improved from ($1.1) | | Free Cash Flow Usage | N/A | Reduced by 35% YoY | - The company helped a record of nearly **39,000 children** in the first quarter of 2025[6](index=6&type=chunk) - Expanded the scoliosis portfolio with the launch of the **VerteGlide™ System** for Early Onset Scoliosis, marking the company's **80th system launch**[6](index=6&type=chunk) - CEO David Bailey highlighted **strong execution**, progress in scaling OPSB, **gaining market share**, and **successful product launches** as key drivers, confident in continued growth due to **U.S. manufacturing** and the **non-elective nature** of its procedures[4](index=4&type=chunk) [First Quarter 2025 Financial Performance](index=1&type=section&id=First%20Quarter%202025%20Financial%20Performance) Q1 2025 revenue grew 17% to $52.4 million with improved gross margin, but increased operating expenses led to a wider net loss despite improved Adjusted EBITDA [Revenue Analysis](index=1&type=section&id=Revenue%20Analysis) Revenue grew robustly across geographies and product lines, with U.S. up 19% and Scoliosis up 34%, offsetting a 25% decline in Sports Medicine/Other Q1 2025 Revenue by Geography (in millions) | Geography | Q1 2025 Revenue | Q1 2024 Revenue | Growth | | :--- | :--- | :--- | :--- | | U.S. | $40.9 | $34.3 | 19% | | International | $11.5 | $10.4 | 11% | | **Total** | **$52.4** | **$44.7** | **17%** | Q1 2025 Revenue by Product Category (in millions) | Product Category | Q1 2025 Revenue | Q1 2024 Revenue | Growth | | :--- | :--- | :--- | :--- | | Trauma and Deformity | $37.9 | $33.3 | 14% | | Scoliosis | $13.7 | $10.2 | 34% | | Sports Medicine/Other | $0.9 | $1.2 | -25% | [Profitability and Expenses](index=2&type=section&id=Profitability%20and%20Expenses) Gross profit rose 19% to $38.3 million, with margin at 73%, but increased operating expenses led to a wider net loss, though Adjusted EBITDA loss narrowed - Gross profit margin improved to **73%** in Q1 2025 from **72%** in Q1 2024, primarily due to higher domestic growth and lower international set sales[8](index=8&type=chunk) - Operating expenses increased mainly due to: - **General and administrative:** **+22%** to **$30.3M**, driven by personnel additions and increased non-cash stock compensation[9](index=9&type=chunk) - **Sales and marketing:** **+17%** to **$16.6M**, due to higher sales commissions and volume[10](index=10&type=chunk) - **Research and development:** **-22%** to **$2.4M**, due to timing of third-party invoices[11](index=11&type=chunk) Q1 2025 Profitability Metrics (in millions) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Loss | ($10.7) | ($7.8) | | Net Loss per Share | ($0.46) | ($0.34) | | Adjusted EBITDA | ($0.4) | ($1.1) | [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow) Q1 2025 cash balance decreased to $60.8 million, but free cash flow usage improved by 35%, with positive free cash flow anticipated in Q4 2025 - Cash, cash equivalents, short-term investments, and restricted cash totaled **$60.8 million** as of March 31, 2025, down from **$70.8 million** as of December 31, 2024[14](index=14&type=chunk) - The company reduced its first quarter 2025 free cash flow usage by **35%** compared to Q1 2024 and expects to be free cash flow positive in **Q4 2025**[6](index=6&type=chunk) [Full Year 2025 Financial Guidance](index=2&type=section&id=Full%20Year%202025%20Financial%20Guidance) OrthoPediatrics raised its full-year 2025 revenue guidance to $236.0-$242.0 million (15-18% growth) and reiterated Adjusted EBITDA guidance Updated Full Year 2025 Guidance (in millions) | Metric | Previous Guidance | Updated Guidance | Implied Growth (YoY) | | :--- | :--- | :--- | :--- | | Revenue | $235.0 - $242.0 | $236.0 - $242.0 | 15% to 18% | | Adjusted EBITDA | $15.0 - $17.0 | $15.0 - $17.0 (Reiterated) | N/A | - The company reiterated its plan for annual set deployment of **$15.0 million**[15](index=15&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including Balance Sheets, Statements of Operations, Cash Flows, and revenue breakdowns [Condensed Consolidated Balance Sheets](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of March 31, 2025, total assets were $470.3 million, liabilities increased to $123.1 million, and stockholders' equity decreased to $347.1 million Key Balance Sheet Items (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, Restricted Cash & Short-term Investments | $60,762 | $70,790 | | Inventories, net | $119,752 | $117,005 | | Total Assets | $470,250 | $473,209 | | Total Liabilities | $123,104 | $118,643 | | Total Stockholders' Equity | $347,146 | $354,566 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Q1 2025 net revenue was $52.4 million, but operating loss widened to $11.0 million and net loss increased to $10.7 million, or $0.46 per share Q1 Statement of Operations Summary (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Revenue | $52,411 | $44,685 | | Gross Profit | $38,262 | $32,174 | | Total Operating Expenses | $49,243 | $41,897 | | Operating Loss | $(10,981) | $(9,723) | | Net Loss | $(10,659) | $(7,805) | | Net Loss Per Share | $(0.46) | $(0.34) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Q1 2025 net cash used in operating activities improved to $4.2 million, while net cash used in investing activities was $6.0 million, resulting in a $10.3 million net cash decrease Q1 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(4,156) | $(6,690) | | Net cash used in investing activities | $(5,987) | $(3,679) | | Net cash used in financing activities | $(126) | $(573) | | **Net Decrease in Cash** | **$(10,348)** | **$(9,463)** | [Net Revenue by Geography and Product Category](index=8&type=section&id=NET%20REVENUE%20BY%20GEOGRAPHY%20AND%20PRODUCT%20CATEGORY) Q1 2025 revenue breakdown shows U.S. contributing $40.9 million (78%) and International $11.5 million (22%), with Trauma and Deformity as the largest product segment Q1 2025 vs Q1 2024 Revenue Breakdown (in thousands) | Category | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **By Geography** | | | | U.S. | $40,891 | $34,305 | | International | $11,520 | $10,380 | | **By Product** | | | | Trauma and deformity | $37,867 | $33,302 | | Scoliosis | $13,664 | $10,203 | | Sports medicine/other | $880 | $1,180 | | **Total** | **$52,411** | **$44,685** | [Non-GAAP Financial Measures Reconciliation](index=3&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) This section reconciles GAAP to non-GAAP measures, adjusting Q1 2025 net loss of $10.7 million to an Adjusted EBITDA loss of $0.4 million and GAAP diluted loss per share to $0.39 Reconciliation of Net Loss to Non-GAAP Adjusted EBITDA (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss (GAAP) | $(10,659) | $(7,805) | | Adjustments (Depreciation, Stock Comp, etc.) | $10,280 | $6,097 | | **Adjusted EBITDA (Non-GAAP)** | **$(379)** | **$(1,108)** | Reconciliation of Diluted Loss Per Share to Non-GAAP Adjusted Diluted Loss Per Share | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Loss per share, diluted (GAAP) | $(0.46) | $(0.34) | | Adjustments (Acquisition costs, etc.) | $0.07 | $0.04 | | **Loss per share, diluted (Non-GAAP)** | **$(0.39)** | **$(0.30)** | [Other Information](index=3&type=section&id=Other%20Information) This section provides investor logistical details, forward-looking statements disclaimer, and a corporate overview of OrthoPediatrics' exclusive focus on pediatric orthopedics - A conference call to discuss the results was scheduled for **May 7, 2025**, with a webcast available for replay on the company's investor relations website[16](index=16&type=chunk) - The company identifies itself as being exclusively focused on pediatric orthopedics, marketing **80 systems** across trauma and deformity, scoliosis, and sports medicine in the U.S. and over **75 other countries**[20](index=20&type=chunk) - The press release contains forward-looking statements that involve risks and uncertainties, and the company directs investors to its SEC filings for a full list of risk factors[17](index=17&type=chunk)

Core Insights - OrthoPediatrics Corp. reported a 17% year-over-year increase in total revenue for Q1 2025, reaching $52.4 million compared to $44.7 million in Q1 2024 [4] - The company continues to focus on pediatric orthopedics, achieving significant growth in both U.S. and international markets [3][4] Financial Performance - Total revenue for Q1 2025 was $52.4 million, a 17% increase from $44.7 million in Q1 2024 [4] - U.S. revenue increased by 19% to $40.9 million, representing 78% of total revenue, while international revenue grew by 11% to $11.5 million, accounting for 22% of total revenue [4] - Trauma and Deformity revenue rose 14% to $37.9 million, and Scoliosis revenue surged 34% to $13.7 million [5][4] - Gross profit for Q1 2025 was $38.3 million, a 19% increase from $32.2 million in the same period last year, with a gross profit margin of 73% [6] Operating Expenses - Total operating expenses for Q1 2025 were $49.2 million, an 18% increase from $41.9 million in Q1 2024, primarily due to increased personnel and non-cash stock compensation [7][10] - Sales and marketing expenses rose by 17% to $16.6 million, driven by higher sales commissions [8] Profitability Metrics - The net loss for Q1 2025 was $10.7 million, compared to a net loss of $7.8 million in Q1 2024, with a net loss per share of $0.46 [11] - Adjusted EBITDA for Q1 2025 was a loss of $0.4 million, an improvement from a loss of $1.1 million in Q1 2024 [11][29] Cash Flow and Guidance - The company reduced free cash flow usage by 35% compared to the same period last year and anticipates achieving positive free cash flow in Q4 2025 [8] - Full-year 2025 revenue guidance was increased to between $236.0 million and $242.0 million, reflecting a growth of 15% to 18% compared to 2024 [13]

Core Insights - OrthoPediatrics Corp. has announced the expansion of its Trauma and Deformity portfolio with the introduction of the 3P Pediatric Plating Platform Hip System, marking its fifth FDA approval in 2025 [1][3]. Product Development - The 3P Pediatric Plating Platform Hip System is designed to modernize trauma and deformity correction treatments in lower extremities, providing surgeons with enhanced coverage for various indications through unique implants and instruments [2]. - The beta launch of the 3P Hip is expected to be followed by the 3P Small/Mini system in early 2026, with additional systems planned for future launches, aiming to transform the company's plate and screw product portfolio [2]. Company Strategy - The Trauma and Deformity division President highlighted the 3P Pediatric Plating Platform as a significant opportunity to address unmet needs in the market, representing one of the largest product initiatives in the company's history [3]. - The CEO emphasized the commitment to providing a comprehensive portfolio of innovative orthopedic treatments for pediatric patients, reflecting the company's focus on expanding its product offerings [3]. Company Overview - Founded in 2006, OrthoPediatrics specializes in pediatric orthopedics, offering over 80 products across major categories including trauma and deformity, scoliosis, and sports medicine [4]. - The company distributes its products in the United States and over 70 countries globally, focusing exclusively on pediatric orthopedic solutions [4].

Company Overview - OrthoPediatrics Corp. is focused exclusively on advancing pediatric orthopedics, having developed a comprehensive product offering to improve the lives of children with orthopedic conditions [3] - The company markets over 80 products across three major categories: trauma and deformity, scoliosis, and sports medicine/other procedures [3] - OrthoPediatrics has a global sales organization that distributes its products in the United States and over 70 countries outside the United States [3] Upcoming Financial Results - OrthoPediatrics is scheduled to release its first quarter 2025 financial results on May 7, 2025, after the market closes [1] - A conference call will be held on the same day at 4:30 p.m. ET to discuss the financial results [1] Investor Information - Investors can access a live and archived webcast of the conference call on the company's website, which will be available for replay for at least 90 days after the event [2]

WARSAW, Ind., April 08, 2025 (GLOBE NEWSWIRE) -- OrthoPediatrics Corp. (“OrthoPediatrics” or the “Company”) (Nasdaq: KIDS), a company focused exclusively on advancing the field of pediatric orthopedics, today announced the U.S. launch of the new VerteGlide Spinal Growth Guidance System, used to treat Early Onset Scoliosis (“EOS”). This represents the company’s 80th system designed to treat musculoskeletal issues in children. VerteGlide is a guided growth technology designed for children with Early Onset Sco ...

WARSAW, Ind., March 25, 2025 (GLOBE NEWSWIRE) -- OrthoPediatrics Corp. (“OrthoPediatrics” or the “Company”) (Nasdaq: KIDS), a company focused exclusively on advancing the field of pediatric orthopedics, today announced that Dave Bailey, President & Chief Executive Officer, and Fred Hite, Chief Operating Officer, and Chief Financial Officer, are scheduled to participate in a fireside chat at the 24th Annual Needham Virtual Healthcare Conference. Event:24th Annual Needham Virtual Healthcare ConferenceFormat:F ...

WARSAW, Ind., March 24, 2025 (GLOBE NEWSWIRE) -- OrthoPediatrics Corp. (“OrthoPediatrics” or the “Company”) (Nasdaq: KIDS), a company focused exclusively on advancing the field of pediatric orthopedics, today announced it was selected as one of the 2025 Best Places to Work in Indiana. This is the 9th time the Company has been recognized by the annual program created by the Indiana Chamber of Commerce. OrthoPediatrics President & CEO David Bailey commented, “I’m so proud of our organization for being named o ...

WARSAW, Ind., March 17, 2025 (GLOBE NEWSWIRE) -- OrthoPediatrics Corp. (“OrthoPediatrics” or the “Company”) (Nasdaq: KIDS), a company focused exclusively on advancing the field of pediatric orthopedics, announced today its partnership with the Crossroads Pediatric Device Consortium (CPDC). This collaboration aligns with the Company’s cause of improving the lives of children by supporting the development and commercialization of innovative pediatric medical devices.​ The Crossroads Pediatric Device Consortiu ...

Financial Performance and Position - As of December 31, 2024, the company had federal, state, and foreign net operating loss carryforwards (NOLs) of $136.6 million, $85.4 million, and $35.2 million, respectively[176]. - The company recorded impairment charges of $1.0 million and $3.6 million related to the ApiFix trademark asset during the third quarter of 2023 and 2022, respectively, and an additional charge of $1.8 million in the fourth quarter of 2024[179]. - The company faces limitations on the use of its net operating loss carryforwards due to ownership changes, with an estimated annual limitation of $9.7 million imposed on the use of pre-change NOLs[176]. - Revenue increased from $148.7 million in 2023 to $204.7 million in 2024, representing a growth of approximately 37.6%[231]. - Approximately 21% of revenue in 2024 was attributable to international customers, down from 25% in 2023 and 24% in 2022[237]. - The company has assessed no material exposure to interest rate risk from its investment portfolio, which consists largely of high-quality corporate debt instruments[448]. - The company does not currently hedge against foreign currency exchange rate fluctuations but may consider doing so in the future[450]. - The company has not recorded any significant unrealized losses or impairment charges on its investments during the periods presented[448]. Market and Competitive Environment - The company operates in a highly competitive environment with significant competitors including Johnson & Johnson MedTech, Medtronic, and Smith & Nephew, which may impact its market position[186]. - The company’s ability to commercialize new products is critical for growth, as failure to do so may hinder its competitive position in the pediatric orthopedic market[180]. - The company has expanded its international sales organization to over 70 independent stocking distributors and multiple direct sales representatives, selling products in over 75 countries[209]. - The company has faced difficulties in obtaining value analysis committee (VAC) approvals from hospitals, which can be lengthy and costly, impacting sales[208]. - The company lacks published long-term data supporting superior clinical outcomes of its products, which may hinder market acceptance and sales growth[214]. - The company’s future sales depend on effectively marketing to orthopedic surgeons and demonstrating the merits of its products compared to competitors[201]. Regulatory and Compliance Risks - The company may face regulatory scrutiny regarding the provision of loaned instrument sets to customers, which could implicate federal and state fraud and abuse laws[192]. - The company is subject to fluctuations in its effective tax rate due to various factors, including changes in tax laws and profitability across jurisdictions[175]. - The company must comply with UK Medical Device Regulations to affix the UKCA Mark, with compliance required by 2025[274]. - Non-compliance with federal and state regulations could lead to product recalls or production termination, significantly impacting supply[280]. - The company is subject to periodic inspections by the FDA and Notified Body, which could result in enforcement actions if non-compliance is found[281]. - Regulatory authorities may require recalls of products due to material deficiencies or defects, which could impact sales and reputation[288]. - The company faces significant risks related to compliance with the FCPA and other anti-corruption laws, particularly in jurisdictions with developing economies[242]. - Any violation of anti-corruption laws could result in substantial fines, sanctions, and harm to the company's business and financial condition[243]. Operational Challenges - The company must maintain significant levels of inventory for implant and instrument sets, which could lead to inventory impairment charges if portions become obsolete[191]. - The company may experience challenges in managing anticipated growth, which could strain organizational and operational infrastructure[231]. - The company may face challenges in integrating acquired businesses or technologies, which could disrupt ongoing operations and management focus[198]. - The company has experienced limited access to healthcare professionals due to the COVID-19 pandemic, affecting product development and marketing efforts[200]. - The company may pursue growth through acquisitions or strategic alliances, which carry risks related to integration and operational impact[193]. Intellectual Property and Litigation - The company owns 77 issued U.S. patents and 207 issued foreign patents, with 50 pending U.S. patent applications and 66 pending foreign patent applications as of December 31, 2024[321]. - The company’s ability to enforce patent rights may be compromised by difficulties in detecting infringement and potential legal challenges[324]. - The company may face substantial costs and liabilities from intellectual property litigation, which could strain financial resources and harm its reputation[330]. - The company indemnifies customers against infringement claims, which may lead to costly litigation and potential damages[331]. - Significant litigation regarding patent rights in the industry may impact the company's ability to commercialize products and could divert management's attention[328]. Stock and Shareholder Matters - The company has 24,217,508 outstanding shares of common stock as of December 31, 2024, with potential future sales impacting stock price[343]. - The stock price may be volatile due to various factors, including fluctuations in financial condition and operating results[338]. - The company does not anticipate paying any cash dividends in the foreseeable future, with capital appreciation being the sole source of gain for shareholders[354]. - As of December 31, 2024, principal stockholders and management own approximately 32.5% of the company's outstanding common stock, allowing them to exert significant control over corporate actions[347]. Strategic Initiatives - The company initiated a restructuring plan in 2024 aimed at improving operational efficiency and reducing costs, which includes workforce reductions and site consolidations[235]. - The restructuring plan involves upfront costs such as severance payments and lease termination expenses, which may exceed initial estimates[238]. - The company has hired a VP of Asia-Pacific sales in 2024 to expand sales efforts in Australia and other Asia Pacific countries[209]. - The company relies on a network of over 40 independent sales agencies in the U.S. and more than 70 independent stocking distributors internationally, selling products in over 75 countries[309]. Environmental and Social Considerations - The company recognizes that climate change and related legislative initiatives may materially affect its business and results of operations[245]. - The company has no specific insurance covering environmental claims related to hazardous materials, but reserves funds for potential claims[306]. Miscellaneous - The company incurs significant costs due to compliance with regulations and disclosure obligations as a public company[247]. - The company is increasingly dependent on sophisticated information technology systems, which require significant resources to maintain and protect[253]. - The company may be subject to various litigation claims and legal proceedings, which could result in significant legal fees and divert management's resources[257]. - The trading market for the company's common stock is influenced by the research and reports published by securities or industry analysts[355].

Financial Data and Key Metrics Changes - The company reported total revenue of $52.7 million for Q4 2024, representing a 40% increase compared to Q4 2023 [15][53] - US revenue was $42.9 million, a 52% increase year-over-year, accounting for 79% of total revenue [54] - International revenue was $9.8 million, reflecting a 5% growth year-over-year [55] - Adjusted EBITDA for Q4 2024 was $3.0 million, more than double the $1.3 million reported in Q4 2023 [64] - Free cash flow usage was $3.7 million, a 70% reduction compared to the year-to-date average for the first three quarters of 2024 [64] Business Line Data and Key Metrics Changes - Trauma and deformity global revenue reached $36.4 million, a 35% increase compared to the prior year [56] - Scoliosis global revenue was $15.6 million, increasing by 62% year-over-year [57] - The OPSB business is expected to grow north of 20% in 2025, driven by high demand and successful integration of Boston OMP [111] Market Data and Key Metrics Changes - International sales generated $9.8 million, with a 5% growth year-over-year, despite challenges in South America [40] - Non-LATAM T&D growth exceeded 20%, and scoliosis grew nearly 30%, indicating strong underlying demand [41] Company Strategy and Development Direction - The company aims to help one million kids annually and plans to dominate the $500 million pediatric orthopedic market [11][10] - Focus on capital-efficient growth through the OPSB business, which has a higher contribution margin than the implant business [11] - The company is expanding its clinic business and anticipates significant growth opportunities in new territories [27][92] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, citing strong demand for products and successful scaling of operations [14][18] - The anticipated EU MDR approval is expected to be a significant catalyst for growth in 2025 and beyond [42][43] - Management highlighted the importance of surgeon training and education in maintaining leadership in the pediatric orthopedic market [45] Other Important Information - The company made strategic decisions, including a $3.7 million restructuring charge due to the closure of the OP Israel office [49] - Gross profit margin for Q4 2024 was 68%, down from 71% in Q4 2023, primarily due to reclassification of expenses [59][60] Q&A Session Summary Question: Guidance on segment contributions and international business impact - Management indicated that while they do not guide by segment, they expect positive impacts from EU MDR in 2025 and beyond, with scoliosis growth likely outpacing trauma and deformity [75][82] Question: Opportunities in OPSB and clinic expansion - Management confirmed strong demand for OPSB and clinic expansion, with expectations of significant growth in 2025 [88][92] Question: Gross margin outlook and potential for improvement - Management acknowledged potential for gross margin improvement through consolidation and pricing strategies, but maintained conservative guidance [98][102] Question: Update on enabling technology and new product launches - Management reported progress on the Playbook enabling technology and confirmed that the new fusion implant system is on track for launch in the second half of the year [130]