Globus Medical(GMED) - 2023 Q2 - Quarterly Report

Financial Performance - Total net sales for the three months ended June 30, 2023, were $291.6 million, representing a 10.6% increase from $263.6 million in the same period of 2022[130] - Total net sales for the six months ended June 30, 2023, reached $568.3 million, a 15.0% increase from $494.2 million in 2022[143] - Net sales in the United States increased by $20.2 million, or 9.0%, primarily due to increased spine product sales and enabling technologies[130] - Net sales in the United States increased by $57.9 million (13.7%) primarily due to higher spine product sales, including robotic spine instruments[143] - International net sales rose by $7.8 million, or 20.2%, driven by increased spine product sales in existing territories[130] - International net sales rose by $16.2 million (22.3%), driven by increased spine product sales in existing territories[144] Costs and Expenses - Cost of goods sold for the three months ended June 30, 2023, was $76.5 million, an increase of 11.7% from $68.5 million in 2022, representing 26.2% of net sales[132] - Cost of goods sold for the six months ended June 30, 2023, was $147.3 million, reflecting a 15.4% increase from $127.6 million in 2022[145] - Research and development expenses increased by $4.0 million, or 22.7%, totaling $21.3 million, which is 7.3% of net sales[133] - Research and development expenses increased by $7.6 million (21.9%) to $42.4 million, representing 7.5% of net sales[146] - Selling, general and administrative expenses rose by $13.4 million, or 12.5%, totaling $120.1 million, which is 41.2% of net sales[134] - Selling, general and administrative expenses rose by $35.0 million (16.9%) to $242.5 million, accounting for 42.7% of net sales[148] Income and Tax - Other income increased by $5.7 million, or 206.2%, reaching $8.5 million, primarily due to higher interest income from marketable securities[139] - Other income increased significantly by $10.0 million (192.3%) to $15.2 million, primarily due to higher interest income from marketable securities[152] - The income tax provision for the three months ended June 30, 2023, was $17.0 million, a 6.3% increase from $15.9 million in 2022, with an effective tax rate of 22.7%[140] Cash Flow and Investments - The net cash provided by operating activities for the six months ended June 30, 2023, was $88.3 million, an increase of $6.8 million from $81.6 million in 2022[156] - Cash used in investing activities increased significantly to $63.2 million from $13.2 million, reflecting net inflows from marketable securities[158] - The company expects to continue investing in surgical sets and expanding its U.S. sales force while exploring potential future acquisitions[155] Strategic Outlook - The company expects the merger with NuVasive to close in the third quarter of 2023, pending regulatory approvals[116] - The company emphasizes the importance of compliance with applicable laws and regulations affecting its business operations[166] - The company highlights its ability to safeguard intellectual property and defend against legal proceedings[166] - Trends in the medical device industry and general economic conditions are noted as significant factors impacting the business[166] - The company acknowledges the evolving environment and the emergence of new risk factors and uncertainties[166] - Forward-looking statements in the quarterly report are only valid as of the report date, with no obligation to update them[167]