CONMED (CNMD) Q2 Earnings Beat, Sales Rise Y/Y, '24 View Cut

Core Insights - CONMED Corporation (CNMD) reported adjusted earnings per share (EPS) of 98 cents for Q2 2024, exceeding the Zacks Consensus Estimate of 92 cents by 6.5% and showing an 18.1% improvement year-over-year [1] - The company's revenues totaled $332.1 million, reflecting a 4.5% year-over-year increase but missing the Zacks Consensus Estimate by 0.7% [3] - CONMED's stock has declined by 14.7% over the past six months, while the industry has seen a modest rise of 1.5% [1] Revenue Performance - Revenue growth was driven by strong performance in both the U.S. and international markets, with constant exchange rate (CER) revenues increasing by 5.2% [3] - The Orthopedic Surgery segment reported revenues of $139.5 million, down 0.9% year-over-year, while the General Surgery segment saw revenues of $192.6 million, up 8.9% year-over-year [4][5] - U.S. sales increased by 6.1% year-over-year, with international sales rising by 2.6% on a reported basis [6] Margins and Expenses - Gross profit improved by 7.6% to $183.7 million, with gross margin increasing by 160 basis points to 55.3% [7] - Selling and administrative expenses decreased by 5.5% to $122.5 million, while research and development expenses rose by 3.9% to $14.1 million [7] Operating Income - The company recorded an operating income of $47.1 million, significantly up from $27.4 million in the prior year, with an operating margin of 14.2%, an increase of 560 basis points [8] 2024 Guidance - CONMED revised its revenue guidance for 2024 to a range of $1.305 billion to $1.315 billion, down from the previous guidance of $1.330 billion to $1.355 billion [9] - Adjusted EPS guidance was also lowered to a range of $3.95 to $4.02, compared to the prior range of $4.25 to $4.35 [10] Market Outlook - The company faces supply-chain issues affecting its Orthopedic segment, particularly in sports medicine and foot and ankle businesses, which may persist [11] - However, strong demand in the General Surgery business is expected to help mitigate the impact of these supply-chain challenges [12]