Summary of OrthoPediatrics Conference Call Company Overview - **Company**: OrthoPediatrics - **Industry**: Medical Devices, specifically Pediatric Orthopedics - **Focus**: Developing orthopedic solutions exclusively for the pediatric population - **Impact**: Helped over 1,200,000 children with orthopedic devices since founding [4] Core Business Insights - **Unique Position**: OrthoPediatrics is the only company focused exclusively on pediatric orthopedics, addressing unique clinical conditions in children [4][5] - **Market Size**: The global pediatric orthopedic market is estimated at $6.2 billion, with the U.S. addressable market at approximately $2.6 billion [8] - **Growth Rate**: The company has experienced nearly 20% year-over-year growth for nearly two decades [7] - **Customer Base**: Serves 100% of the top children's hospitals in the U.S. and Canada, with an estimated 95% of children's hospitals in developed countries as customers [6] Strategic Pillars 1. **Focus on High-Volume Children's Hospitals**: Targeting major hospitals rather than community physicians [9] 2. **Comprehensive Product Offering**: Aspiring to provide all necessary products to pediatric orthopedic surgeons [10] 3. **Investment in R&D**: Significant investments in research and development to expand product offerings [11] 4. **Clinical Education**: Commitment to training the next generation of pediatric orthopedic surgeons [20] 5. **Market Expansion**: Plans to expand into new markets and territories [33] Financial Performance - **Revenue Growth**: Projected revenue for 2025 is between $237 million and $242 million, with a record revenue of over $61 million in the latest quarter [36][42] - **Adjusted EBITDA**: Expected to be between $15 million and $17 million for 2025, up from $8.5 million in 2024 [36] - **Cash Flow**: Projected to be cash flow breakeven in Q4 2023 and for the full year of 2026 [37] Product Development and Innovations - **Product Portfolio**: Over 80 unique pediatric systems, with a focus on clinically significant and disruptive technologies [6][13] - **Scoliosis Solutions**: Investments in early onset scoliosis treatments and new technologies like the Vertaglyde system, which is expected to drive growth [25][28] - **Specialty Bracing**: Expansion into specialty bracing, representing a $500 million opportunity [18] Market Dynamics - **Competitive Landscape**: The market is described as benign with limited competition, allowing OrthoPediatrics to focus on its unique offerings [8] - **Partnerships and Acquisitions**: Actively acquiring smaller companies with innovative technologies that benefit pediatric orthopedics [15][16] Key Challenges and Opportunities - **Challenges**: Historical reliance on repurposed adult implants and limited product development for pediatric use [5] - **Opportunities**: Expanding into new markets and developing new products to meet the needs of pediatric orthopedic surgeons [33] Conclusion - OrthoPediatrics is positioned as a leader in pediatric orthopedics with a strong growth trajectory, a commitment to innovation, and a focus on clinical education and market expansion. The company is well-recognized in the industry and is actively working to address unmet needs in pediatric orthopedic care [14][21].

[Note Regarding Forward-Looking Statements](index=3&type=section&id=Note%20Regarding%20Forward-Looking%20Statements) This section outlines that forward-looking statements are subject to various known and unknown risks and uncertainties, which may cause actual results to differ materially - Forward-looking statements are subject to known and unknown risks, including widespread health emergencies, and may not be accurate[8](index=8&type=chunk)[9](index=9&type=chunk) - Key areas of uncertainty include achieving/sustaining profitability, raising capital, commercializing products, complying with regulations, expanding sales networks, and protecting intellectual property[10](index=10&type=chunk) PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements for OrthoPediatrics Corp., including balance sheets, statements of operations, comprehensive loss, stockholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, business combinations, debt arrangements, and other financial disclosures for the periods ended June 30, 2025 and 2024 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20-%20June%2030,%202025%20and%20December%2031,%202024) Condensed Consolidated Balance Sheet Highlights | Metric | June 30, 2025 (in Thousands) | December 31, 2024 (in Thousands) | Change (in Thousands) | % Change | | :--------------------------------- | :----------------------------- | :------------------------------- | :-------------------- | :------- | | **ASSETS** | | | | | | Total current assets | $257,702 | $237,173 | $20,529 | 8.66% | | Total assets | $503,606 | $473,209 | $30,397 | 6.42% | | **LIABILITIES** | | | | | | Total current liabilities | $38,666 | $33,962 | $4,704 | 13.85% | | Total long-term liabilities | $109,426 | $84,681 | $24,745 | 29.22% | | Total liabilities | $148,092 | $118,643 | $29,449 | 24.82% | | **STOCKHOLDERS' EQUITY** | | | | | | Total stockholders' equity | $355,514 | $354,566 | $948 | 0.27% | - Significant increases in **Accounts Receivable** (from **$42,357k to $53,797k**) and **Inventories** (from **$117,005k to $125,265k**) contributed to current asset growth[13](index=13&type=chunk) - Long-term debt saw a substantial increase, with the **long-term term loan rising from $23,957k to $47,942k**[13](index=13&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20-%20Three%20and%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) Condensed Consolidated Statements of Operations Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Net revenue | $61,082 | $52,802 | $8,280 | 15.68% | | Cost of revenue | $17,063 | $12,003 | $5,060 | 42.16% | | Gross profit | $44,019 | $40,799 | $3,220 | 7.89% | | Operating loss | $(10,657) | $(5,666) | $(4,991) | 88.09% | | Net loss | $(7,113) | $(6,029) | $(1,084) | 17.98% | | Basic and diluted EPS | $(0.30) | $(0.26) | $(0.04) | 15.38% | - Restructuring expenses of **$2,971k** (3 months) and **$3,011k** (6 months) were recorded in 2025, compared to none in 2024, contributing to the increased operating loss[15](index=15&type=chunk)[31](index=31&type=chunk) - Other (income) expense shifted significantly from an expense of **$381k** (3 months) and **$994k** (6 months) in 2024 to an income of **$3,593k** (3 months) and **$4,111k** (6 months) in 2025, primarily due to foreign exchange gains[15](index=15&type=chunk)[31](index=31&type=chunk)[148](index=148&type=chunk) [Condensed Consolidated Statements of Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss%20-%20Three%20and%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) Condensed Consolidated Statements of Comprehensive Loss Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Net loss | $(7,113) | $(6,029) | $(1,084) | 17.98% | | Foreign currency translation adjustment | $6,635 | $(3,263) | $9,898 | -303.29% | | Other comprehensive gain (loss), net of tax | $6,680 | $(3,263) | $9,943 | -304.70% | | Comprehensive loss | $(433) | $(9,292) | $8,859 | -95.34% | - A significant **foreign currency translation adjustment of $6,635k** (3 months) and **$5,706k** (6 months) positively impacted comprehensive loss in 2025, contrasting with negative adjustments in 2024[17](index=17&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%20Equity%20-%20Three%20and%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) Condensed Consolidated Statements of Stockholders' Equity Highlights | Metric (in Thousands) | June 30, 2025 | December 31, 2024 | Change | % Change | | :-------------------- | :------------ | :---------------- | :----- | :------- | | Common Stock Value | $6 | $6 | $0 | 0.00% | | Additional Paid-in Capital | $613,790 | $600,897 | $12,893 | 2.15% | | Accumulated Deficit | $(253,336) | $(235,564) | $(17,772) | 7.54% | | Accumulated Other Comprehensive Loss | $(4,946) | $(10,773) | $5,827 | -54.09% | | Total Stockholders' Equity | $355,514 | $354,566 | $948 | 0.27% | - **Additional paid-in capital increased by $12,893k**, driven by restricted stock issuances (**$3,859k + $5,252k**), common stock issuances (**$233k + $1,261k**), and a capital contribution related to MedTech liability reclassification (**$2,062k**)[19](index=19&type=chunk) - The **accumulated deficit increased by $17,772k**, reflecting the net loss for the six months ended June 30, 2025[19](index=19&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20-%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) Condensed Consolidated Statements of Cash Flows Highlights | Metric (in Thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------- | :----------- | | Net cash used in operating activities | $(14,618) | $(12,782) | $(1,836) | 14.36% | | Net cash (used in) provided by investing activities | $(9,532) | $16,018 | $(25,550) | -159.51% | | Net cash provided by (used in) financing activities | $24,674 | $(4,842) | $29,516 | -609.59% | | Net increase (decrease) in cash, cash equivalents and restricted cash | $828 | $(2,137) | $2,965 | -138.75% | | Cash, cash equivalents and restricted cash, end of period | $46,605 | $30,890 | $15,715 | 50.87% | - Cash used in operating activities increased by **$1.8 million**, primarily due to inventory purchases to support sales growth and changes in accounts receivable and accounts payable[152](index=152&type=chunk)[153](index=153&type=chunk) - Investing activities shifted from providing **$16.0 million** in cash in 2024 (due to sale of marketable securities) to using **$9.5 million** in 2025, mainly for property and equipment purchases (**$7.7 million**) and investments in private companies[154](index=154&type=chunk) - Financing activities provided **$24.7 million** in cash in 2025, driven by **$25.0 million** in proceeds from debt issuance, a significant change from **$4.8 million** cash used in 2024[155](index=155&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [NOTE 1 – BUSINESS](index=11&type=section&id=NOTE%201%20%E2%80%93%20BUSINESS) - OrthoPediatrics Corp. designs, develops, and markets medical devices and specialized braces for pediatric orthopedic conditions, including PediLoc, PediPlates, Cannulated Screws, RESPONSE Spine, and Boston Brace 3D[28](index=28&type=chunk) - The company is the only global medical device company exclusively focused on the pediatric orthopedic market, addressing trauma and deformity correction, scoliosis, and sports medicine[28](index=28&type=chunk) - The company utilizes a contract manufacturing model for implants and instruments, manufactures orthopedic bracing products in-house, and operates multiple O&P clinics[28](index=28&type=chunk) [NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=11&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) - The financial statements are unaudited, prepared in conformity with GAAP, and should be read in conjunction with the 2024 Annual Report on Form 10-K[30](index=30&type=chunk) - Despite recurring losses and an accumulated deficit of **$253.3 million** as of June 30, 2025, management believes current cash and expected cash flows are sufficient for operations for more than the next twelve months, supporting a going concern assumption[33](index=33&type=chunk) - Recent ASUs (2023-06, 2023-09, 2024-03) related to disclosure improvements and income tax disclosures are being evaluated but are not expected to have a material impact on the condensed consolidated financial statements, with the exception of ASU 2024-03 which is still being evaluated[37](index=37&type=chunk)[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk) [NOTE 3 - BUSINESS COMBINATIONS AND ASSET ACQUISITIONS](index=13&type=section&id=NOTE%203%20-%20BUSINESS%20COMBINATIONS%20AND%20ASSET%20ACQUISITIONS) - The MedTech Concepts, LLC acquisition involved a purchase price of approximately **$15,274k**, settled with cash, common stock, and future anniversary payments[41](index=41&type=chunk) - On May 9, 2025, the MedTech Purchase Agreement was amended to settle fixed cash portions of the three remaining anniversary payments (**$3,750k** aggregate gross value) with unregistered shares of common stock to preserve cash[43](index=43&type=chunk)[150](index=150&type=chunk) - The acquisition of Boston O&P on January 5, 2024, for **$21,767k** (cash and stock) expanded the company's pediatric orthotic and prosthetic devices and clinical services, resulting in **$8,589k** in goodwill and **$6,573k** in identifiable intangible assets[46](index=46&type=chunk)[48](index=48&type=chunk) - Boston O&P continued to acquire multiple O&P clinics in 2024 and 2025, with total consideration of approximately **$4,818k** in 2024 and **$475k** through June 30, 2025[48](index=48&type=chunk)[49](index=49&type=chunk) [NOTE 4 - GOODWILL AND INTANGIBLE ASSETS](index=16&type=section&id=NOTE%204%20-%20GOODWILL%20AND%20INTANGIBLE%20ASSETS) Goodwill and Intangible Assets Highlights | Metric (in Thousands) | June 30, 2025 | December 31, 2024 | Change | % Change | | :-------------------- | :------------ | :---------------- | :----- | :------- | | Goodwill | $99,019 | $93,844 | $5,175 | 5.51% | | Net Amortizable Intangible Assets | $62,950 | $64,427 | $(1,477) | -2.29% | | Other Intangible Assets (Trademarks) | $17,082 | $16,752 | $330 | 1.97% | - **Goodwill increased by $5,175k**, driven by foreign currency translation impact (**$4,628k**), clinic acquisitions (**$314k**), and Boston O&P measurement period adjustment (**$233k**)[51](index=51&type=chunk) - An impairment charge of **$1,836k** was recorded for the ApiFix trademark in 2024, reducing its carrying value to its estimated fair value[55](index=55&type=chunk) [NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS](index=17&type=section&id=NOTE%205%20-%20FAIR%20VALUE%20OF%20FINANCIAL%20INSTRUMENTS) - The fair value hierarchy categorizes inputs into Level 1 (quoted prices in active markets), Level 2 (observable market-based inputs), and Level 3 (significant unobservable inputs)[57](index=57&type=chunk) Financial Assets by Fair Value Level | Financial Assets (in Thousands) | Level 1 (June 30, 2025) | Level 2 (June 30, 2025) | Level 3 (June 30, 2025) | Total (June 30, 2025) | | :------------------------------ | :---------------------- | :---------------------- | :---------------------- | :-------------------- | | Corporate Bonds | $0 | $10,460 | $0 | $10,460 | | Treasury Bonds | $10,546 | $0 | $0 | $10,546 | | Asset-Backed Securities | $0 | $4,298 | $0 | $4,298 | | Exchange Mutual Funds | $292 | $0 | $0 | $292 | - Contingent consideration, valued using discounted cash flow or probability simulation models with unobservable inputs like forecasted revenues and discount rates, is classified as Level 3[61](index=61&type=chunk) [NOTE 6 - DEBT AND CREDIT ARRANGEMENTS](index=18&type=section&id=NOTE%206%20-%20DEBT%20AND%20CREDIT%20ARRANGEMENTS) Debt and Credit Arrangements Highlights | Debt Type (in Thousands) | June 30, 2025 | December 31, 2024 | Change | % Change | | :----------------------- | :------------ | :---------------- | :----- | :------- | | Term loan and final payment | $51,000 | $25,500 | $25,500 | 100.00% | | Convertible note | $50,000 | $50,000 | $0 | 0.00% | | Mortgage payable to affiliate | $532 | $611 | $(79) | -12.93% | | Acquisition note payable | $1,200 | $1,372 | $(172) | -12.54% | | Total debt | $102,732 | $77,483 | $25,249 | 32.59% | | Long-term debt, net of current maturities | $97,004 | $72,956 | $24,048 | 32.96% | - On August 5, 2024, the company entered into a Credit Agreement with Braidwell LP for a **$50,000k** term loan facility, including an initial **$25,000k** and a delayed draw facility for an additional **$25,000k**, which was fully withdrawn on June 27, 2025[63](index=63&type=chunk)[156](index=156&type=chunk) - Concurrently, the company issued **$50,000k** in **4.75% Convertible Senior Notes** due February 15, 2030, to Braidwell, convertible into common stock at an initial price of **$40.98 per share**[69](index=69&type=chunk)[71](index=71&type=chunk)[157](index=157&type=chunk) - The new Braidwell debt facilities replaced the **$80,000k** MidCap Credit Agreement, resulting in a **$3,230k** loss on extinguishment of debt in 2024[76](index=76&type=chunk)[80](index=80&type=chunk)[160](index=160&type=chunk) [NOTE 7 - INCOME TAXES](index=22&type=section&id=NOTE%207%20-%20INCOME%20TAXES) Income Tax Highlights | Metric (in Thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Income tax charge (benefit) | $245 | $(2,549) | $2,794 | -109.61% | | Effective income tax rate | (1.4)% | 15.6% | -17.0% | -108.97% | - The lower effective tax rate in 2025 is due to the remeasurement of the valuation allowance after recording the deferred tax liability from the Boston O&P acquisition in the prior year[85](index=85&type=chunk) - Deferred tax assets are fully offset by a valuation allowance, except for certain deferred tax liabilities in Canada, where a tax expense was recorded[86](index=86&type=chunk) [NOTE 8 - STOCKHOLDERS' EQUITY](index=22&type=section&id=NOTE%208%20-%20STOCKHOLDERS%20EQUITY) Stockholders' Equity Highlights | Metric (in Thousands) | June 30, 2025 | December 31, 2024 | Change | % Change | | :-------------------- | :------------ | :---------------- | :----- | :------- | | Total Stockholders' Equity | $355,514 | $354,566 | $948 | 0.27% | | Additional Paid-in Capital | $613,790 | $600,897 | $12,893 | 2.15% | - Stock-based compensation expense on restricted stock was **$5,252k** for the three months and **$9,111k** for the six months ended June 30, 2025, an increase from **$2,939k** and **$5,738k** respectively in 2024[89](index=89&type=chunk) - A stock repurchase program of up to **$5,000k** was approved in August 2024, but no shares have been purchased as of June 30, 2025, and the annual repurchase limit was reduced to **$250k** after December 31, 2024[90](index=90&type=chunk)[91](index=91&type=chunk)[158](index=158&type=chunk) [NOTE 9 – NET LOSS PER SHARE](index=23&type=section&id=NOTE%209%20%E2%80%93%20NET%20LOSS%20PER%20SHARE) Net Loss Per Share Highlights | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Net loss per share - basic and diluted | $(0.30) | $(0.26) | $(0.04) | 15.38% | | Weighted average shares outstanding | 23,460,144 | 23,145,064 | 315,080 | 1.36% | - The effect of outstanding common stock equivalents (**1,551,951 shares** in 2025 and **1,068,624 shares** in 2024) was anti-dilutive, hence basic and diluted shares remained the same[93](index=93&type=chunk) [NOTE 10 – BUSINESS SEGMENT](index=23&type=section&id=NOTE%2010%20%E2%80%93%20BUSINESS%20SEGMENT) - The company operates as one operating and reportable segment, with the CEO reviewing consolidated financial information and disaggregated revenue by product category[95](index=95&type=chunk) Product Sales by Geographic Location and Category | Product Sales by Geographic Location (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :---------------------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | U.S. | $48,147 | $41,249 | $6,898 | 16.72% | | International | $12,935 | $11,553 | $1,382 | 11.96% | | Total | $61,082 | $52,802 | $8,280 | 15.68% | | Product Sales by Category (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :--------------------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Trauma and deformity | $41,655 | $37,771 | $3,884 | 10.28% | | Scoliosis | $18,522 | $13,682 | $4,840 | 35.38% | | Sports medicine/other | $905 | $1,349 | $(444) | -32.91% | | Total | $61,082 | $52,802 | $8,280 | 15.68% | - Strong performance in **Trauma and Deformity** (**10%** and **12%** increase for 3 and 6 months, respectively) and **Scoliosis** (**35%** increase for both periods) drove overall revenue growth[138](index=138&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk) [NOTE 11 - RELATED PARTY TRANSACTIONS](index=24&type=section&id=NOTE%2011%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) - OrthoPediatrics uses Structure Medical, LLC, an affiliate of Squadron Capital, LLC (the company's largest investor), as a supplier[98](index=98&type=chunk) Payments to Structure Medical for Inventory Purchases | Payments to Structure Medical for Inventory Purchases (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :------------------------------------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Inventory Purchases | $657 | $141 | $516 | 365.96% | [NOTE 12 – COMMITMENTS AND CONTINGENCIES](index=24&type=section&id=NOTE%2012%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) - The global restructuring plan, initiated in Q4 2024, led to a restructuring accrual of **$2,829k** as of June 30, 2025, primarily due to new severance agreements[99](index=99&type=chunk)[145](index=145&type=chunk) - The IMED Surgical lawsuit regarding '377 Patent ownership was dismissed for failure to prosecute, but IMED re-initiated arbitration[101](index=101&type=chunk)[107](index=107&type=chunk) - The Boston O&P litigation alleges wrongful death and negligence; the selling equityholders of Boston O&P are contractually obligated to indemnify the company for claims related to this lawsuit[109](index=109&type=chunk)[111](index=111&type=chunk) - The company has a remaining purchase commitment of **$728k** for 7D Surgical FLASH Navigation in 2025 and **$1,092k** for 2026[113](index=113&type=chunk) - An expense of **$700k** was recorded for the six months ended June 30, 2025, for unmet minimum performance metrics related to the FIREFLY Technology license agreement, with **55,143 common shares** issued to Mighty Oak Medical to satisfy past obligations[113](index=113&type=chunk)[182](index=182&type=chunk) [NOTE 13 – SUBSEQUENT EVENTS](index=27&type=section&id=NOTE%2013%20%E2%80%93%20SUBSEQUENT%20EVENTS) - On July 11, 2025, Boston O&P acquired assets of O&P clinics in New York for **$5,410k** (cash and promissory note), with a potential earnout of up to **$1,125k**[116](index=116&type=chunk) - On July 30, 2025, OP EU B.V. acquired O&P clinics in Ireland for **1,500 Euro** (cash and promissory note), aiming to expand in Europe[117](index=117&type=chunk) - On August 3, 2025, OrthoPediatrics EU Limited acquired a UK-based designer and manufacturer of Clubfoot bracing for **3,400 GBP** (cash and promissory note), expanding specialty bracing and entering a new territory[118](index=118&type=chunk) - The Tax Reform Act of 2025, enacted on July 4, 2025, includes changes to corporate income tax law (e.g., **100% bonus depreciation**, immediate R&D expensing), and the company is evaluating its impact on financial statements[119](index=119&type=chunk)[120](index=120&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations for the three and six months ended June 30, 2025, covering business overview, social impact initiatives, key trends and uncertainties, a detailed analysis of the statements of operations, liquidity and capital resources, and critical accounting policies [Overview](index=28&type=section&id=Overview) - OrthoPediatrics is the only global medical device company exclusively focused on the pediatric orthopedic market, serving trauma and deformity correction, scoliosis, and sports medicine, with an estimated global market opportunity of **$6.2 billion** (**$2.8 billion** in the U.S.)[122](index=122&type=chunk) - The company markets **82 surgical and specialized bracing systems** and operates approximately **40 O&P clinics** in the U.S.[124](index=124&type=chunk)[123](index=123&type=chunk) - Revenue from implants and instruments is recognized upon implantation (consignment model), with consignment sales accounting for approximately **68% of total net sales** for the six months ended June 30, 2025[129](index=129&type=chunk) - The company aims to strengthen its position by increasing investments in implant/instrument sets, enhancing global sales/distribution, and expanding product offerings and O&P clinic networks[128](index=128&type=chunk) [Social Impact](index=29&type=section&id=Social%20Impact) - OrthoPediatrics has impacted **1,217,000 children's lives** since inception, including those served by acquired companies[130](index=130&type=chunk) - The company partners with over **40 charitable organizations** worldwide to provide pediatric orthopedic care and was recognized as 'Corporate Partner of the Year' by World Pediatric Project in 2020[132](index=132&type=chunk) - OrthoPediatrics is committed to fostering a respectful, compassionate, and inclusive environment, reflected in its diversity and inclusion policy and recognition as a 'Best Company to Work in Indiana' for nine years[132](index=132&type=chunk) [Trends and Uncertainties](index=30&type=section&id=Trends%20and%20Uncertainties) - The company recorded impairment losses on the ApiFix trademark of **$1.8 million**, **$1.0 million**, and **$3.6 million** in 2024, 2023, and 2022, respectively, and future impairment charges could be material[134](index=134&type=chunk) - Widespread respiratory illnesses, such as RSV, have negatively impacted elective procedure volumes and hospital capacity in 2022 and 2023, and may continue to do so[135](index=135&type=chunk) - Changes in U.S. trade policy, including new tariffs (e.g., **10% baseline**, **50% on Brazil**, **15% on EU** announced in July 2025), and retaliatory actions, could significantly increase product costs and reduce demand, adversely affecting financial performance[175](index=175&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk) - Changes in Medicaid coverage and reimbursement policies could negatively impact business by reducing procedure volumes, increasing pricing pressure, and delaying product adoption, particularly in hospitals and clinics serving high volumes of Medicaid patients[179](index=179&type=chunk)[180](index=180&type=chunk) [Summary of Statements of Operations](index=31&type=section&id=Summary%20of%20Statements%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) Summary of Statements of Operations Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Net revenue | $61,082 | $52,802 | $8,280 | 15.68% | $113,493 | $97,487 | $16,006 | 16.42% | | Cost of revenue | $17,063 | $12,003 | $5,060 | 42.16% | $31,212 | $24,514 | $6,698 | 27.32% | | Gross profit | $44,019 | $40,799 | $3,220 | 7.89% | $82,281 | $72,973 | $9,308 | 12.76% | | Gross margin | 72% | 77% | -5% | -6.49% | 72% | 75% | -3% | -4.00% | | Operating loss | $(10,657) | $(5,666) | $(4,991) | 88.09% | $(21,638) | $(15,389) | $(6,249) | 40.61% | | Net loss | $(7,113) | $(6,029) | $(1,084) | 17.98% | $(17,772) | $(13,834) | $(3,938) | 28.46% | [Net Revenue](index=31&type=section&id=Net%20Revenue) Net Revenue by Geographic Location and Product Category | Product Sales by Geographic Location (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :---------------------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | U.S. | $48,147 | $41,249 | $6,898 | 16.72% | | International | $12,935 | $11,553 | $1,382 | 11.96% | | Total | $61,082 | $52,802 | $8,280 | 15.68% | | Product Sales by Category (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :--------------------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Trauma and deformity | $41,655 | $37,771 | $3,884 | 10.28% | | Scoliosis | $18,522 | $13,682 | $4,840 | 35.38% | | Sports medicine/other | $905 | $1,349 | $(444) | -32.91% | | Total | $61,082 | $52,802 | $8,280 | 15.68% | - **Trauma and deformity sales increased by 10%** (3 months) and **12%** (6 months), driven by Cannulated Screws, PNP Femur, PNP Tibia, DF2, and OPSB[139](index=139&type=chunk) - **Scoliosis sales increased by 35%** for both periods, primarily due to RESPONSE 5.5/6.0 and revenue from 7D Technology[139](index=139&type=chunk)[140](index=140&type=chunk) [Cost of Revenue and Gross Margin](index=32&type=section&id=Cost%20of%20Revenue%20and%20Gross%20Margin) Cost of Revenue and Gross Margin Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Cost of revenue | $17,063 | $12,003 | $5,060 | 42.16% | | Gross margin | 72% | 77% | -5% | -6.49% | - The decrease in gross margin was primarily driven by a higher percentage of sales of 7D units and international set sales[141](index=141&type=chunk) [Sales and Marketing Expenses](index=32&type=section&id=Sales%20and%20Marketing%20Expenses) Sales and Marketing Expenses Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Sales and marketing expenses | $19,103 | $16,593 | $2,510 | 15.13% | - The increase was primarily due to increased sales commission expenses and an overall increase in the volume of units sold[142](index=142&type=chunk) [General and Administrative Expenses](index=32&type=section&id=General%20and%20Administrative%20Expenses) General and Administrative Expenses Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | General and administrative expenses | $30,443 | $27,329 | $3,114 | 11.40% | - The increase was primarily due to additional personnel through clinic acquisitions, increased lease expense, and a **$2.4 million** increase in stock compensation for the six months ended June 30, 2025[143](index=143&type=chunk) [Restructuring Expense](index=32&type=section&id=Restructuring%20Expense) Restructuring Expense Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Restructuring | $2,971 | $0 | $2,971 | 100.00% | - The 2024 Restructuring Plan aims to improve operational efficiency, reduce costs by integrating the ApiFix product into the OP Scoliosis portfolio, and reduce staff[145](index=145&type=chunk) [Research and Development Expenses](index=32&type=section&id=Research%20and%20Development%20Expenses) Research and Development Expenses Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Research and development expenses | $2,159 | $2,543 | $(384) | -15.10% | - The decrease was primarily due to the timing of product development during the first and second quarters of 2024 compared to the same periods in 2025[147](index=147&type=chunk) [Total Other (Income) Expenses](index=33&type=section&id=Total%20Other%20%28Income%29%20Expenses) Total Other (Income) Expenses Highlights | Metric (in Thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :----------- | | Total other (income) expense, net | $(3,593) | $381 | $(3,974) | -1043.04% | - The significant change was primarily driven by an increase in foreign exchange gain[148](index=148&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) - The company has incurred operating losses since inception, resulting in negative cash flows from operating activities (**$14.6 million** for six months ended June 30, 2025) and an accumulated deficit of **$253.3 million**[149](index=149&type=chunk) - As of June 30, 2025, cash, cash equivalents, restricted cash, and short-term investments totaled **$72.2 million**[149](index=149&type=chunk) - Efforts to preserve cash include issuing unregistered shares for MedTech acquisition payments (approx. **$3.8 million** value) and paying director compensation with restricted stock[150](index=150&type=chunk) [Cash Flows](index=33&type=section&id=Cash%20Flows) Cash Flow Highlights | Metric (in Thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | YoY % Change | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------- | :----------- | | Net cash used in operating activities | $(14,618) | $(12,782) | $(1,836) | 14.36% | | Net cash (used in) provided by investing activities | $(9,532) | $16,018 | $(25,550) | -159.51% | | Net cash provided by (used in) financing activities | $24,674 | $(4,842) | $29,516 | -609.59% | | Net increase (decrease) in cash, cash equivalents and restricted cash | $828 | $(2,137) | $2,965 | -138.75% | - The increase in cash used in operating activities was driven by inventory purchases to support sales growth and changes in accounts receivable and accounts payable[153](index=153&type=chunk) - Investing activities shifted from a net inflow to a net outflow due to no longer having cash from the sale of short-term marketable securities to offset business combinations and property/equipment purchases[154](index=154&type=chunk) - Financing activities provided **$24.7 million**, primarily from the **$25.0 million** delayed draw on the Braidwell term loan[155](index=155&type=chunk)[156](index=156&type=chunk) [Indebtedness](index=34&type=section&id=Indebtedness) - On August 5, 2024, the company secured a **$100 million** financing arrangement with Braidwell LP, consisting of a **$50 million** term loan and **$50 million** of convertible notes[156](index=156&type=chunk) - The term loan bears interest at **SOFR + 6.50%** (with a **3.25% SOFR floor**) and includes financial covenants requiring maintenance of unrestricted cash (**25% of outstanding principal**) and minimum net product sales, with the delayed draw of **$25 million** withdrawn on June 27, 2025[156](index=156&type=chunk)[64](index=64&type=chunk)[66](index=66&type=chunk) - The **$50 million convertible notes** accrue interest at **4.75% per annum** and are convertible into common stock at an initial price of **$40.98 per share**[157](index=157&type=chunk) - This new financing replaced the **$80 million** MidCap Credit Agreement, which had approximately **$10 million** outstanding and was terminated[160](index=160&type=chunk) [Pediatric Orthopedic Business Seasonality](index=35&type=section&id=Pediatric%20Orthopedic%20Business%20Seasonality) - Revenue is typically higher in summer months and holiday periods due to increased pediatric surgeries for trauma, deformity, and scoliosis products[162](index=162&type=chunk) - The seasonality is influenced by longer recovery times provided by breaks in the school year, which facilitates elective surgeries[162](index=162&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=35&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) - No material changes to critical accounting policies were reported since the 2024 Annual Report on Form 10-K[163](index=163&type=chunk) [Recent Accounting Pronouncements](index=35&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 2 for details on recent accounting pronouncements[164](index=164&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section addresses the company's exposure to market risks, primarily interest rate risk related to indebtedness and foreign currency exchange rate risk, noting that there have been no material changes to these disclosures since the 2024 Annual Report on Form 10-K - The greatest potential market risk exposures are interest rate risk on indebtedness and foreign currency exchange rate risk on operating results[165](index=165&type=chunk) - No material changes to market risk disclosures were reported since the 2024 Annual Report on Form 10-K[165](index=165&type=chunk) [Item 4. Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details management's evaluation of the company's disclosure controls and procedures, concluding their effectiveness as of June 30, 2025, and confirming that no material changes occurred in internal control over financial reporting during the period [Evaluation of Disclosure Controls and Procedures](index=35&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - Management concluded that disclosure controls and procedures were effective as of June 30, 2025[167](index=167&type=chunk) - Disclosure controls provide reasonable assurance that information required for SEC reports is recorded, processed, summarized, and reported within specified time periods[167](index=167&type=chunk) [Changes in Internal Control over Financial Reporting](index=36&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - No material changes in internal control over financial reporting occurred during the quarter[169](index=169&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) This section incorporates by reference the detailed discussion of legal proceedings from Note 12, which includes the IMED Surgical software ownership dispute and the Boston O&P litigation, and confirms no other legal proceedings are expected to materially impact its financial position or operations - Legal proceedings, including the IMED Surgical software ownership dispute and Boston O&P litigation, are discussed in Note 12[171](index=171&type=chunk) - No other legal proceedings are currently expected to materially affect the company's financial position, results of operations, or cash flows[172](index=172&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) This section directs readers to the comprehensive risk factors outlined in the 2024 Annual Report on Form 10-K, while also highlighting new or updated risks related to international business operations, including tariffs and trade restrictions, and potential adverse impacts from changes in Medicaid coverage and reimbursement policies - Readers should consider risk factors from the 2024 Annual Report on Form 10-K[173](index=173&type=chunk) - New risks include those related to international business, such as tariffs (e.g., **10% baseline**, **50% on Brazil**, **15% on EU** announced in July 2025), trade restrictions, and government actions, which could adversely affect operations and costs[174](index=174&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk) - Changes in Medicaid coverage and reimbursement policies could negatively impact the business by reducing procedure volumes, increasing pricing pressure, and delaying product adoption[179](index=179&type=chunk)[180](index=180&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports on the issuance of unregistered common stock in May 2025 to settle obligations related to the MedTech acquisition and unmet performance metrics for Mighty Oak Medical, Inc., noting these issuances were made under Section 4(a)(2) of the Securities Act of 1933, with no proceeds used and no shares repurchased under the stock repurchase program - On May 1, 2025, **10,830 unregistered common shares** (approx. **$226k** value) were issued to MedTech Concepts LLC to settle an anniversary cash payment[181](index=181&type=chunk) - On May 15, 2025, **55,143 unregistered common shares** (approx. **$1,261k** value) were issued to Mighty Oak Medical, Inc. to satisfy past unmet minimum performance metrics[182](index=182&type=chunk) - These issuances were made in reliance on the exemption provided under Section 4(a)(2) of the Securities Act of 1933[181](index=181&type=chunk)[182](index=182&type=chunk) - No shares have been purchased under the approved stock repurchase program as of June 30, 2025[186](index=186&type=chunk) [Item 3. Defaults Upon Senior Securities](index=39&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there were no defaults upon senior securities during the reporting period - No defaults upon senior securities[187](index=187&type=chunk) [Item 4. Mine Safety Disclosures](index=39&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that there are no mine safety disclosures to report - No mine safety disclosures[188](index=188&type=chunk) [Item 5. Other Information](index=39&type=section&id=Item%205.%20Other%20Information) This section confirms that no information required under Form 8-K, no modifications to the nomination process, and no insider trading arrangements were adopted or terminated by directors or officers during the three months ended June 30, 2025 - No information required under Form 8-K[190](index=190&type=chunk) - No modifications to the nomination process[191](index=191&type=chunk) - No insider trading arrangements (Rule 10b5-1 or non-Rule 10b5-1) were adopted or terminated by directors or officers during the three months ended June 30, 2025[192](index=192&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section provides a comprehensive list of exhibits filed with the Form 10-Q, including various agreements, corporate documents, debt instruments, and certifications, which are either included or incorporated by reference [Exhibit Index](index=40&type=section&id=Exhibit%20Index) - Exhibits include Membership Interest Purchase Agreements, Stock Purchase Agreements, Certificate of Incorporation, Bylaws, Registration Rights Agreements, Stockholders Agreement, Indenture, Convertible Senior Notes, Director Compensation Policy, and various certifications (CEO, CFO)[195](index=195&type=chunk) [Signatures](index=42&type=section&id=Signatures) - The report was signed by David R. Bailey (President and CEO) and Fred L. Hite (CFO and COO) on August 6, 2025[201](index=201&type=chunk)

Core Insights - OrthoPediatrics reported Q2 2025 GAAP revenue of $61.1 million, slightly below Wall Street's estimate of $61.47 million, while adjusted loss per share narrowed to ($0.11), beating expectations by $0.18 [1][2][10] - The company continues to experience year-over-year growth across core segments, although higher operating expenses have resulted in a net loss position [1][8] Financial Performance - Q2 2025 metrics include a 15.7% year-over-year revenue increase from $52.8 million in Q2 2024, and a gross profit of $44.0 million, up 7.8% from the previous year [2][5] - Adjusted EBITDA improved to $4.1 million, a 57.7% increase year-over-year, while operating expenses grew 17.6% to $54.7 million, leading to an operating loss of $10.6 million [2][10] - The company reported a net loss of $7.1 million in Q2 2025, compared to $6.0 million a year earlier [8][10] Business Overview - OrthoPediatrics specializes in pediatric orthopedic devices, focusing on trauma, deformity correction, scoliosis solutions, and sports medicine devices, addressing a market gap for children [3][4] - The company emphasizes innovation through rapid product development and strategic acquisitions, aiming to enhance its portfolio and market penetration [4] Product Performance - Trauma and deformity correction products generated $41.7 million in Q2 2025, while scoliosis sales reached $18.5 million, growing 34% year-over-year [7] - Specialty bracing under the OPSB division expanded over 20% year-over-year, while sports medicine revenue decreased by 25% [7] International and Domestic Revenue - U.S. revenue contributed $48.1 million, while international revenue was $13.0 million, up from $11.6 million a year earlier, despite slower sales in Latin America [5][6] Outlook and Guidance - Management raised full-year 2025 revenue guidance to $236 to $242 million, implying 16% to 18% growth, and reaffirmed a gross margin range of 72% to 73% [12][13] - The company aims for positive free cash flow in Q4 2025 and breakeven by 2026, with a focus on cash discipline and sustainable profitability [13][14]

Core Insights - OrthoPediatrics reported revenue of $61.08 million for the quarter ended June 2025, reflecting a year-over-year increase of 15.7% [1] - The company's EPS was -$0.11, an improvement from -$0.23 in the same quarter last year, with a surprise of +35.29% compared to the consensus estimate of -$0.17 [1] - The revenue fell short of the Zacks Consensus Estimate of $61.7 million, resulting in a surprise of -1% [1] Revenue Performance - Product sales in the Trauma and deformity category reached $41.67 million, below the three-analyst average estimate of $44.58 million, marking a year-over-year increase of 10.3% [4] - Sales in the Sports medicine/other category were $0.91 million, significantly lower than the $1.18 million average estimate, representing a year-over-year decline of 32.9% [4] - Scoliosis product sales amounted to $18.52 million, exceeding the average estimate of $15.95 million, with a year-over-year increase of 35.4% [4] Stock Performance - Over the past month, OrthoPediatrics shares have returned -3.3%, contrasting with the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Company Performance - OrthoPediatrics reported a quarterly loss of $0.11 per share, better than the Zacks Consensus Estimate of a loss of $0.17, and an improvement from a loss of $0.23 per share a year ago, resulting in an earnings surprise of +35.29% [1] - The company posted revenues of $61.08 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 1%, but showing an increase from year-ago revenues of $52.8 million [2] - Over the last four quarters, OrthoPediatrics has surpassed consensus EPS estimates just once and topped consensus revenue estimates two times [2] Stock Outlook - OrthoPediatrics shares have declined approximately 11.4% since the beginning of the year, contrasting with the S&P 500's gain of 7.6% [3] - The company's earnings outlook is mixed, with the current consensus EPS estimate for the coming quarter at -$0.14 on revenues of $63.72 million, and -$1.24 on revenues of $239.45 million for the current fiscal year [7] Industry Context - The Medical - Instruments industry, to which OrthoPediatrics belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact OrthoPediatrics' stock performance [5]

Financial Data and Key Metrics Changes - In Q2 2025, worldwide revenue reached $61.1 million, a 16% increase compared to 2024, driven by strong performance across Trauma and Deformity, Scoliosis, and OPSB [26][27] - US revenue was $48.1 million, a 17% increase from 2024, representing 79% of total revenue [26] - International revenue totaled $12.9 million, reflecting a 12% growth compared to 2024, accounting for 21% of total revenue [27] - Gross profit margin decreased to 72% from 77% in 2024, primarily due to higher 7D growth and increased international set sales [28] - Adjusted EBITDA improved to $4.1 million, a 50% increase from $2.6 million in 2024 [32] Business Line Data and Key Metrics Changes - Trauma and Deformity global revenue was $41.7 million, a 10% increase year-over-year, driven by PMP femur, PMP tibia, DF2, and OPSB [27] - Scoliosis global revenue reached $18.5 million, a 35% increase compared to the prior year, driven by increased sales of Response, ApiFix, and 7D Technology [27][28] - The OPSB business grew over 20%, surpassing initial guidance for 2025 territory expansion [14][20] Market Data and Key Metrics Changes - International sales were solid, particularly in Europe and the Middle East, with strong surgical demand [6][23] - The company achieved its first EU MDR approval through LP Canada, which is expected to catalyze future growth [24] Company Strategy and Development Direction - The company is focused on expanding its OPSB strategy through territory expansion, accelerated R&D, and scaling its sales force [14][20] - The 3P pediatric plating platform is expected to enhance market share in trauma and limb deformity, with multiple new systems planned for launch [13][89] - The company is committed to helping more children and significantly growing revenue while improving adjusted EBITDA and reducing cash burn [35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving strong momentum throughout 2025, driven by successful scaling of OPSB and innovative product launches [8][9] - The company raised its revenue guidance for 2025 to a range of $237 million to $242 million, representing year-over-year growth of 16% to 18% [33] Other Important Information - The company hosted 182 unique training experiences for over 3,420 healthcare professionals in Q2 2025 [25] - The company ended Q2 2025 with $72.2 million in cash, short-term investments, and restricted cash [32] Q&A Session Summary Question: Can you discuss the clinic strategy and the performance of existing clinics? - Management noted that existing clinics are seeing growth due to investments made on the sales side, while new Greenfield clinics are contributing to revenue but not yet at maximum volume [39][40] Question: Can you provide insights on the Scoliosis and T&D business growth expectations for the second half of the year? - Management expects Scoliosis growth to remain strong, potentially exceeding overall company growth, while T&D growth may be lighter due to previous quarter comparisons [45] Question: What caused the selective case slowdown in the limb deformity segment? - Management indicated that the volume was lighter in the first part of Q2 but rebounded strongly in June, attributing the fluctuation to normal business ebbs and flows [49][50] Question: How is the international product expansion strategy structured? - Management stated that international growth is expected to outpace US growth, with new product launches planned on a quarterly basis following EU MDR approvals [64][66] Question: What are the expectations for the trauma portfolio and potential product gaps? - Management highlighted the introduction of the 3P system as a significant opportunity to fill gaps in the trauma and deformity market, with plans for multiple system launches over the next few years [88][89]

2025 Investor Presentation www.OrthoPediatrics.com Disclaimer Forward-Looking Statements All statements, other than statements of historical facts, contained in this quarterly report, including statements regarding our business, operations and financial performance and condition, as well as our plans, objectives and expectations for our business, operations and financial performance and condition, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "ma ...

[Company Overview and Q2 2025 Highlights](index=1&type=section&id=Company%20Overview%20and%20Q2%202025%20Highlights) OrthoPediatrics Corp. reported strong Q2 2025 results, achieving record revenue of $61.1 million, a 16% increase year-over-year, fueled by robust procedure and clinic volumes and market share gains across key segments [Second Quarter 2025 and Business Highlights](index=1&type=section&id=Second%20Quarter%202025%20and%20Business%20Highlights) OrthoPediatrics Corp. reported strong Q2 2025 results, achieving record revenue of $61.1 million, a 16% increase year-over-year, fueled by robust procedure and clinic volumes and market share gains across key segments like Scoliosis and Trauma - OrthoPediatrics achieved record Q2 2025 total revenue of **$61.1 million**, marking a **16% increase year-over-year**, driven by strong procedure and clinic volumes and market share gains[3](index=3&type=chunk)[4](index=4&type=chunk)[5](index=5&type=chunk) - Adjusted EBITDA increased by **58% to $4.1 million** in Q2 2025, compared to $2.6 million in Q2 2024[1](index=1&type=chunk)[5](index=5&type=chunk)[14](index=14&type=chunk) - The company expanded its OrthoPediatrics Specialty Bracing Division (OPSB) with multiple new clinics and entry into two new territories, including its first international operation in Ireland[3](index=3&type=chunk)[5](index=5&type=chunk) - Full year 2025 revenue guidance was increased to a range of **$237.0 million to $242.0 million** from a range of $236.0 million to $242.0 million, representing **16% to 18% growth** over 2024[5](index=5&type=chunk)[16](index=16&type=chunk) [Second Quarter 2025 Financial Results Summary](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Results%20Summary) Total revenue for Q2 2025 reached $61.1 million, a 16% increase year-over-year, with U.S. revenue growing 17% and international revenue increasing 12%, primarily fueled by strong performance in Scoliosis and Trauma & Deformity [Revenue Performance](index=1&type=section&id=Revenue%20Performance) Total revenue for Q2 2025 reached $61.1 million, a 16% increase year-over-year, with U.S. revenue growing 17% to $48.1 million and international revenue increasing 12% to $12.9 million, driven by strong performance in Scoliosis and Trauma & Deformity [Total and Geographic Revenue](index=1&type=section&id=Total%20and%20Geographic%20Revenue) Total revenue for Q2 2025 reached a record $61.1 million, a 16% increase from the prior year, with domestic revenue growing 17% to $48.1 million and international revenue increasing 12% to $12.9 million | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change | % of Total Revenue (Q2 2025) | | :----- | :----------------- | :----------------- | :--------- | :----------------------------- | | Total Revenue | $61.1 | $52.8 | 16% | 100% | | U.S. Revenue | $48.1 | $41.2 | 17% | 79% | | International Revenue | $12.9 | $11.6 | 12% | 21% | [Product Category Revenue](index=2&type=section&id=Product%20Category%20Revenue) Scoliosis revenue showed the strongest growth, increasing 35% to $18.5 million, driven by new product sales and 7D technology, while Trauma and Deformity revenue grew 10% to $41.7 million | Product Category | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change | | :--------------- | :----------------- | :----------------- | :--------- | | Trauma and Deformity | $41.7 | $37.8 | 10% | | Scoliosis | $18.5 | $13.7 | 35% | | Sports Medicine/Other | $0.9 | $1.3 | -33% | - Growth in Scoliosis was driven by increased sales of Response and ApiFix non-fusion system, and revenue generated from 7D technology[7](index=7&type=chunk) - Trauma and Deformity growth was primarily driven by PNP Femur, PNP Tibia, DF2, and OPSB products[7](index=7&type=chunk) [Profitability and Operating Expenses](index=2&type=section&id=Profitability%20and%20Operating%20Expenses) Gross profit increased by 8% to $44.0 million, but the gross profit margin declined to 72% due to higher 7D growth and international Scoliosis set sales, leading to an increased net loss of $7.1 million, despite a 58% increase in Adjusted EBITDA to $4.1 million | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change | | :----- | :----------------- | :----------------- | :--------- | | Gross Profit | $44.0 | $40.8 | 8% | | Gross Profit Margin | 72% | 77% | -5 ppts | | Net Loss | ($7.1) | ($6.0) | -18.3% | | GAAP Diluted Loss Per Share | ($0.30) | ($0.26) | -15.4% | | Non-GAAP Diluted Loss Per Share | ($0.11) | ($0.23) | 52.2% | | Adjusted EBITDA | $4.1 | $2.6 | 58% | - The decrease in gross margin was primarily driven by higher 7D growth and increased international Scoliosis set sales, both of which generate lower gross margins[8](index=8&type=chunk) - Total operating expenses increased by **18%** due to restructuring charges (**$3.0 million**), increased non-cash stock compensation, and additional personnel to support company growth, including OPSB clinics[9](index=9&type=chunk)[12](index=12&type=chunk) [Gross Profit and Margin](index=2&type=section&id=Gross%20Profit%20and%20Margin) Gross profit for Q2 2025 was $44.0 million, an 8% increase year-over-year, but the gross profit margin decreased to 72% from 77% due to higher growth of 7D technology and international Scoliosis set sales | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change | | :----- | :----------------- | :----------------- | :--------- | | Gross Profit | $44.0 | $40.8 | 8% | | Gross Profit Margin | 72% | 77% | -5 ppts | - The decline in gross margin was mainly attributed to higher 7D growth and increased international Scoliosis set sales, which generate lower gross margins[8](index=8&type=chunk) [Operating Expenses Breakdown](index=2&type=section&id=Operating%20Expenses%20Breakdown) Total operating expenses rose 18% to $54.7 million, driven by increases in sales and marketing (15% to $19.1 million) and general and administrative expenses (11% to $30.4 million), alongside $3.0 million in restructuring charges | Expense Category | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change | | :--------------- | :----------------- | :----------------- | :--------- | | Total Operating Expenses | $54.7 | $46.5 | 18% | | Sales and Marketing | $19.1 | $16.6 | 15% | | General and Administrative | $30.4 | $27.3 | 11% | | Research and Development | $2.2 | $2.5 | -15% | | Restructuring Charges | $3.0 | $0.0 | N/A | - The increase in total operating expenses was mainly driven by restructuring charges, increased non-cash stock compensation, and incremental personnel to support ongoing growth, including OPSB clinics[9](index=9&type=chunk)[11](index=11&type=chunk) [Net Loss and Adjusted EBITDA](index=2&type=section&id=Net%20Loss%20and%20Adjusted%20EBITDA) The company reported a net loss of $7.1 million for Q2 2025, an increase from $6.0 million in Q2 2024, with GAAP diluted loss per share at ($0.30), while non-GAAP diluted loss per share improved to ($0.11) and Adjusted EBITDA increased 58% to $4.1 million | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change | | :----- | :----------------- | :----------------- | :--------- | | Net Loss | ($7.1) | ($6.0) | -18.3% | | GAAP Diluted Loss Per Share | ($0.30) | ($0.26) | -15.4% | | Non-GAAP Diluted Loss Per Share | ($0.11) | ($0.23) | 52.2% | | Adjusted EBITDA | $4.1 | $2.6 | 58% | - Total other income was **$3.6 million** for Q2 2025, a significant improvement from an expense of $0.4 million in the prior year, primarily driven by an increase in foreign exchange translation gain[12](index=12&type=chunk) [Financial Position and Cash Flows](index=2&type=section&id=Financial%20Position%20and%20Cash%20Flows) As of June 30, 2025, cash, cash equivalents, short-term investments, and restricted cash totaled $72.2 million, a slight increase from $70.8 million at the end of 2024 | Metric | June 30, 2025 (Millions) | December 31, 2024 (Millions) | Change | | :----- | :----------------------- | :--------------------------- | :----- | | Cash, Cash Equivalents, Short-term Investments, and Restricted Cash | $72.2 | $70.8 | +$1.4M | - Weighted average basic and diluted shares outstanding for the three months ended June 30, 2025, was **23,460,144 shares**[15](index=15&type=chunk) [Full Year 2025 Financial Guidance](index=3&type=section&id=Full%20Year%202025%20Financial%20Guidance) OrthoPediatrics increased its full-year 2025 revenue guidance to a range of $237.0 million to $242.0 million, representing 16% to 18% growth over 2024, while reiterating its annual set deployment target and adjusted EBITDA guidance | Metric | Previous Guidance (Millions) | Updated Guidance (Millions) | Growth vs 2024 | | :----- | :--------------------------- | :-------------------------- | :------------- | | Revenue | $236.0 - $242.0 | $237.0 - $242.0 | 16% - 18% | | Annual Set Deployment | $15.0 | $15.0 (Reiterated) | N/A | | Adjusted EBITDA | $15.0 - $17.0 | $15.0 - $17.0 (Reiterated) | N/A | [Condensed Consolidated Financial Statements](index=5&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's balance sheets, statements of operations, and cash flows, along with detailed revenue breakdowns by geography and product category [Condensed Consolidated Balance Sheets](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of June 30, 2025, total assets increased to $503.6 million from $473.2 million at December 31, 2024, primarily driven by increases in current assets, while total liabilities also increased significantly to $148.1 million due to a rise in long-term loans | Metric | June 30, 2025 (Thousands) | December 31, 2024 (Thousands) | Change | | :----- | :------------------------ | :---------------------------- | :----- | | Total Assets | $503,606 | $473,209 | +$30,397 | | Total Liabilities | $148,092 | $118,643 | +$29,449 | | Total Stockholders' Equity | $355,514 | $354,566 | +$948 | | Cash | $44,553 | $43,820 | +$733 | | Accounts Receivable - trade, net | $53,797 | $42,357 | +$11,440 | | Inventories, net | $125,265 | $117,005 | +$8,260 | | Long-term loan | $47,942 | $23,957 | +$23,985 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the three months ended June 30, 2025, net revenue increased 16% to $61.1 million, but net loss widened to $7.1 million from $6.0 million in the prior year, primarily due to higher cost of revenue, increased operating expenses, and higher interest expense | Metric | 2025 (Thousands) | 2024 (Thousands) | YoY Change | | :----- | :--------------- | :--------------- | :--------- | | Net revenue | $61,082 | $52,802 | 16% | | Cost of revenue | $17,063 | $12,003 | 42.2% | | Gross profit | $44,019 | $40,799 | 8% | | Total operating expenses | $54,676 | $46,465 | 17.7% | | Operating loss | ($10,657) | ($5,666) | -88.1% | | Net loss | ($7,113) | ($6,029) | -18.0% | | Net loss per share – basic and diluted | ($0.30) | ($0.26) | -15.4% | - Other (income) expense significantly improved to **($4,709) thousand** in Q2 2025 from $120 thousand expense in Q2 2024, contributing positively to the bottom line despite other cost increases[26](index=26&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) For the six months ended June 30, 2025, net cash used in operating activities increased to ($14.6) million, investing activities resulted in ($9.5) million cash used, and financing activities provided $24.7 million, primarily from debt issuance | Metric | 2025 (Thousands) | 2024 (Thousands) | Change | | :----- | :--------------- | :--------------- | :----- | | Net cash used in operating activities | ($14,618) | ($12,782) | ($1,836) | | Net cash used in investing activities | ($9,532) | $16,018 | ($25,550) | | Net cash used in financing activities | $24,674 | ($4,842) | $29,516 | | Net decrease in cash, cash equivalents and restricted cash | $828 | ($2,137) | $2,965 | | Cash, cash equivalents and restricted cash, end of period | $46,605 | $30,890 | $15,715 | - The significant change in investing activities was due to the absence of sales of short-term marketable securities (which provided **$49.8 million** in 2024) and new investments in private companies (**$1.5 million**) and clinic acquisitions (**$0.3 million**) in 2025[28](index=28&type=chunk) - Financing activities were positively impacted by **$25.0 million** in proceeds from the issuance of debt in 2025[28](index=28&type=chunk) [Net Revenue by Geography and Product Category](index=9&type=section&id=NET%20REVENUE%20BY%20GEOGRAPHY%20AND%20PRODUCT%20CATEGORY) For the six months ended June 30, 2025, total net revenue increased to $113.5 million, with U.S. revenue at $89.0 million and international revenue at $24.5 million, while Trauma and Deformity remained the largest category at $79.5 million | Geographic Location | 2025 (Thousands) | 2024 (Thousands) | | :------------------ | :--------------- | :--------------- | | U.S. | $89,039 | $75,554 | | International | $24,454 | $21,933 | | Total | $113,493 | $97,487 | | Product Category | 2025 (Thousands) | 2024 (Thousands) | | :--------------- | :--------------- | :--------------- | | Trauma and deformity | $79,521 | $71,073 | | Scoliosis | $32,186 | $23,886 | | Sports medicine/other | $1,786 | $2,528 | | Total | $113,493 | $97,487 | [Non-GAAP Financial Measures Reconciliation](index=10&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) This section provides reconciliations of GAAP net loss and diluted loss per share to their non-GAAP adjusted counterparts, highlighting key adjustments [Reconciliation of Net Loss to Non-GAAP Adjusted EBITDA](index=10&type=section&id=RECONCILIATION%20OF%20NET%20LOSS%20TO%20NON-GAAP%20ADJUSTED%20EBITDA) For the three months ended June 30, 2025, Adjusted EBITDA was $4.1 million, a significant increase from $2.6 million in the prior year, achieved by adjusting net loss for interest expense, depreciation, stock-based compensation, restructuring charges, and other income | Metric | 2025 (Thousands) | 2024 (Thousands) | | :----- | :--------------- | :--------------- | | Net loss | ($7,113) | ($6,029) | | Interest expense, net | $1,116 | $261 | | Other income | ($4,709) | $120 | | Income tax charge (benefit) | $49 | ($18) | | Depreciation and amortization | $5,170 | $4,779 | | Stock-based compensation | $5,252 | $2,939 | | Restructuring charges | $2,971 | — | | Tariff cost | $648 | — | | Acquisition related costs | $474 | $142 | | Minimum purchase commitment cost | $269 | $433 | | Adjusted EBITDA | $4,127 | $2,627 | [Reconciliation of Diluted Loss Per Share to Non-GAAP Adjusted Diluted Loss Per Share](index=10&type=section&id=RECONCILIATION%20OF%20DILUTED%20LOSS%20PER%20SHARE%20TO%20NON-GAAP%20ADJUSTED%20DILUTED%20LOSS%20PER%20SHARE) Non-GAAP diluted loss per share for Q2 2025 improved to ($0.11) from ($0.23) in Q2 2024, primarily due to adjustments for restructuring charges, tariff costs, acquisition-related costs, and minimum purchase commitment costs | Metric | 2025 | 2024 | | :----- | :--- | :--- | | Loss per share, diluted (GAAP) | ($0.30) | ($0.26) | | Restructuring charges | $0.13 | — | | Tariff cost | $0.03 | — | | Acquisition related costs | $0.02 | $0.01 | | Minimum purchase commitment cost | $0.01 | $0.02 | | Loss per share, diluted (non-GAAP) | ($0.11) | ($0.23) | [Additional Company Information](index=3&type=section&id=Additional%20Company%20Information) This section provides background on OrthoPediatrics, details on its conference call, forward-looking statement disclaimers, and explanations of non-GAAP financial measures [About OrthoPediatrics Corp.](index=4&type=section&id=About%20OrthoPediatrics%20Corp.) Founded in 2006, OrthoPediatrics is an orthopedic company exclusively focused on advancing pediatric orthopedics, offering 82 systems across trauma and deformity, scoliosis, and sports medicine/other procedures, distributed globally in over 75 countries - OrthoPediatrics, founded in 2006, is exclusively focused on pediatric orthopedics, offering **82 systems** across trauma and deformity, scoliosis, and sports medicine/other procedures[21](index=21&type=chunk) - The company's global sales organization distributes products in the United States and over **75 other countries**[21](index=21&type=chunk) [Conference Call](index=3&type=section&id=Conference%20Call) OrthoPediatrics will host a conference call on Tuesday, August 5, 2025, at 4:30 p.m. ET to discuss the Q2 2025 financial results, with a live and archived webcast available on the company's investor relations website - A conference call to discuss Q2 2025 results will be held on **August 5, 2025, at 4:30 p.m. ET**, with a webcast available on www.orthopediatrics.com[17](index=17&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements subject to risks and uncertainties, including those related to widespread health emergencies and factors detailed in the company's SEC filings, with OrthoPediatrics disclaiming any obligation to update these statements - The press release includes forward-looking statements, identifiable by words like 'expect,' 'plan,' 'anticipate,' and 'will,' which involve risks and uncertainties beyond the company's control[18](index=18&type=chunk) - Important factors that could cause actual results to differ materially are detailed under 'Risk Factors' in OrthoPediatrics' Annual Report on Form 10-K and other SEC reports[18](index=18&type=chunk) [Use of Non-GAAP Financial Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) The company uses non-GAAP financial measures like Adjusted EBITDA and adjusted diluted loss per share to provide investors with a clearer view of its core operating performance, excluding certain non-recurring or non-cash expenses, emphasizing their supplemental nature to GAAP results - Non-GAAP financial measures, including Adjusted EBITDA and adjusted diluted loss per share, are used to provide a more consistent analysis of core business operating performance by excluding items like restructuring charges, stock-based compensation, and acquisition-related costs[19](index=19&type=chunk)[20](index=20&type=chunk) - Management uses these metrics for operating performance evaluation and planning, but emphasizes that they are supplemental and should not be considered superior to GAAP measures[19](index=19&type=chunk)[20](index=20&type=chunk) [Investor Contact](index=4&type=section&id=Investor%20Contact) For investor inquiries, contact Philip Trip Taylor of Gilmartin Group via email at philip@gilmartinir.com or by phone at 415-937-5406 - Investor contact information is provided for Philip Trip Taylor of Gilmartin Group[22](index=22&type=chunk) [Supplemental Disclosures](index=8&type=section&id=SUPPLEMENTAL%20DISCLOSURES) Supplemental disclosures for the six months ended June 30, 2025, include cash paid for interest of $2.55 million, transfer of instruments from property and equipment and inventory of $0.65 million, and various issuances of common shares for installments and vendor obligations | Metric | 2025 (Thousands) | 2024 (Thousands) | | :----- | :--------------- | :--------------- | | Cash paid for interest | $2,552 | $760 | | Transfer of instruments from property and equipment and inventory | $651 | $281 | | Issuance of common shares for MedTech installment | $226 | $133 | | Issuance of common shares to settle an obligation with a vendor | $1,261 | — | | Right-of-use assets obtained in exchange for lease liabilities | $3,311 | — |

Core Insights - OrthoPediatrics Corp. reported a record revenue of $61.1 million for Q2 2025, marking a 16% increase year-over-year, with adjusted EBITDA rising by 58% to $4.1 million [1][4][8] Financial Performance - Total revenue for Q2 2025 was $61.1 million, up from $52.8 million in Q2 2024, driven by strong growth in Scoliosis, Trauma, and OPSB products [4][8] - U.S. revenue reached $48.1 million, a 17% increase from $41.2 million in the same quarter last year, accounting for 79% of total revenue [4][8] - International revenue was $12.9 million, a 12% increase from $11.6 million year-over-year [4][8] - Trauma and Deformity revenue grew by 10% to $41.7 million, while Scoliosis revenue surged by 35% to $18.5 million [5][8] - Gross profit for Q2 2025 was $44.0 million, an 8% increase from $40.8 million in Q2 2024, with a gross profit margin of 72% [6][8] Operating Expenses - Total operating expenses increased by 18% to $54.7 million, primarily due to restructuring charges and increased personnel costs [7][8] - Sales and marketing expenses rose by 15% to $19.1 million, driven by higher sales commissions [9][8] - General and administrative expenses increased by 11% to $30.4 million, reflecting higher non-cash stock compensation and additional personnel [10][8] Net Loss and Cash Flow - The net loss for Q2 2025 was $7.1 million, compared to a loss of $6.0 million in Q2 2024, with a GAAP diluted loss per share of ($0.30) [12][8] - Non-GAAP diluted loss per share improved to ($0.11) from ($0.23) year-over-year [12][8] - Cash, cash equivalents, and short-term investments totaled $72.2 million as of June 30, 2025, up from $70.8 million at the end of 2024 [13][8] Business Expansion - The company expanded its OrthoPediatrics Specialty Bracing Division (OPSB) with new clinics and entered two new territories, including its first international operation in Ireland [8] - Full-year 2025 revenue guidance was raised to a range of $237.0 million to $242.0 million, indicating a growth of 16% to 18% compared to the previous year [14][8]

Core Insights - OrthoPediatrics Corp. is expanding its OrthoPediatrics Specialty Bracing (OPSB) division with new clinics and entry into new territories, including California, Ohio, and Colorado [1][6] - The company is slightly ahead of its planned entry into four new target markets for 2025, aiming to provide better bracing and O&P care to children globally [3][4] - The expansion includes Acquihire opportunities with new operations in New York and Ireland, marking the first international market for OPSB [2][6] Company Overview - Founded in 2006, OrthoPediatrics focuses exclusively on pediatric orthopedics, offering over 80 products across trauma and deformity, scoliosis, and sports medicine categories [5] - The company distributes its products in the United States and over 70 countries, emphasizing its commitment to improving the lives of children with orthopedic conditions [5] Market Expansion - The new clinic in California targets the Los Angeles market, providing access to millions of potential pediatric patients [6] - The Dayton, OH clinic is located within Dayton Children's Hospital, enhancing local access to skilled clinicians [6] - The expansion into Ireland complements OrthoPediatrics' existing implant business and opens opportunities for further growth in Europe [6]