Financial Data and Key Metrics Changes - Q4 revenues reached a record $1.048 billion, up 5.3% year-over-year and 5.2% sequentially, while full year 2025 revenues were $4 billion, up 1% year-over-year [5][33] - Non-GAAP gross margin for Q4 was 72%, up 1.6 points sequentially and 1.2 points year-over-year, while GAAP gross margin was 65.3%, up 1.1 points sequentially but down 4.8 points year-over-year [40][42] - Q4 operating income was $155.3 million, resulting in an operating margin of 14.8%, up approximately 5.2 points sequentially and 0.3 points year-over-year [46] Business Line Data and Key Metrics Changes - Systems and services revenues were $790 million, up 2.7% year-over-year, while clear aligner revenues for fiscal 2025 were $3.2 billion, up 0.5% year-over-year with record clear aligner volumes of 2.6 million cases [6][7] - Q4 clear aligner revenues were $838 million, up 5.5% year-over-year and 4% sequentially, with a record volume of 677,000 cases, up 7.7% year-over-year [7][8] - Q4 systems and services revenues were $209.4 million, up 10.3% sequentially and 4.2% year-over-year, driven by higher scanner system sales [37][38] Market Data and Key Metrics Changes - Clear aligner volume growth in Q4 was driven by strength in EMEA, Latin America, and APAC, with stability in North America [8][15] - In EMEA, DSO performance showed double-digit growth year-over-year, while in Latin America, clear aligner volumes grew double digits, achieving record quarterly shipments [14][15] - In APAC, clear aligner volumes also grew double digits year-over-year, with significant contributions from China, India, and Korea [19] Company Strategy and Development Direction - The company aims to expand international adoption, increase orthodontic utilization, and strengthen consumer demand conversion through localized marketing [63][68] - The focus on DSOs as a strategic growth channel is emphasized, with partnerships driving digital dentistry adoption [10][12] - Investments in innovation, including AI-driven treatment planning and direct fabrication capabilities, are prioritized to enhance margins and operational efficiency [66][68] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the macro environment, highlighting the importance of disciplined execution across regions and channels [67] - The company expects Q1 2026 worldwide revenues to be in the range of $1.01 billion to $1.03 billion, reflecting a year-over-year growth of 3%-5% [58] - For fiscal 2026, the company anticipates revenue growth of 3%-4% year-over-year, with clear aligner volume growth expected to be in the mid-single digits [60] Other Important Information - Cash and cash equivalents as of December 31, 2025, were $1.0949 billion, with $831.2 million remaining available for stock repurchases under the program [53][55] - The company repurchased approximately 0.7 million shares in Q4 2025 at an average price of $142.87 [54] Q&A Session Summary Question: Can you parse apart the improved volume performance? - Management noted stability in markets and effective execution, particularly with DSOs driving growth [72] Question: What are the assumptions for 2026 guidance regarding end markets? - Management expects markets to behave consistently with recent trends, focusing on active conversion strategies [83] Question: Can you discuss the growth of DSOs and their adoption curve? - Management indicated that DSOs are expanding and that there are still growth opportunities in this segment [86] Question: What is driving the improvement in the adult business? - Factors include DSO growth, financial credit availability, and effective patient conversion strategies [92] Question: How do you view ASPs for 2026? - Management expects ASPs to decline by 1%-2% year-over-year due to country and product mix [101]

Financial Data and Key Metrics Changes - Q4 2025 revenues reached a record $1.048 billion, up 5.3% year-over-year and 5.2% sequentially [3][19] - Full year 2025 total revenues were $4 billion, up 1% year-over-year [3] - Non-GAAP operating margin for Q4 was 22.7%, the highest since 2021 [4] - Q4 overall gross margin was 65.3%, up 1.1 points sequentially but down 4.8 points year-over-year [23][24] Business Line Data and Key Metrics Changes - Systems and services revenues were $790 million, up 2.7% year-over-year [4] - Clear aligner revenues for Q4 were $838 million, up 5.5% year-over-year and up 4% sequentially [4][20] - Fiscal 2025 clear aligner revenues were $3.2 billion, up 0.5% year-over-year with record volumes of 2.6 million cases [4] Market Data and Key Metrics Changes - Q4 clear aligner volume was a record 677,000 cases, up 7.7% year-over-year [5] - Strong growth in EMEA, Latin America, and APAC, with stability in North America [5] - In North America, clear aligner volumes were up year-over-year, with double-digit growth in Latin America [9] Company Strategy and Development Direction - Focus on expanding international adoption and increasing orthodontic utilization, particularly among teens and kids [36][38] - Strengthening partnerships with dental service organizations (DSOs) to drive digital dentistry adoption [6][9] - Continued investment in innovation, including AI-driven treatment planning and direct fabrication capabilities [38] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2026, emphasizing the importance of disciplined execution across regions and channels [36][39] - The macro environment remains dynamic, but the company is encouraged by progress in key customer segments [36] - Management highlighted the need for sustained momentum in North America and improving conversion rates [38] Other Important Information - Cash and cash equivalents as of December 31, 2025, were $1.0949 billion, up $90.3 million sequentially [30] - The company repurchased approximately 0.7 million shares at an average price of $142.87 during Q4 2025 [31] Q&A Session Summary Question: Improved volume performance and its drivers - Management noted stability in markets and effective execution, particularly with DSOs driving growth [42][43] Question: Guidance assumptions for 2026 - Management expects markets to behave similarly to the second half of 2025, focusing on active conversion strategies [51][52] Question: DSO adoption curve and growth potential - Management indicated continued DSO penetration and growth opportunities, with many DSOs expanding globally [53][55] Question: Adult business performance and drivers - Management attributed improved adult business performance to DSOs, financial credit options, and effective patient conversion strategies [60][61] Question: North American retail business stability - Management reported improved stability in the North American retail business, aided by DSOs and a broader product portfolio [63][64] Question: ASP expectations for 2026 - Management anticipates ASPs to decline by 1%-2% year-over-year due to product and country mix [67][70] Question: Tax receipts and stimulus impact - Management did not plan around potential tax receipts but acknowledged them as possible upside [72]

Financial Data and Key Metrics Changes - Q3 total revenues were $996 million, reflecting a 1.8% year-over-year increase and a 1.7% sequential decrease [4][19] - Q3 non-GAAP operating margin was 23.9%, exceeding the outlook of approximately 22% [4][27] - Q3 gross margin was 64.2%, down 5.7 points sequentially and 5.5 points year-over-year [22][23] Business Line Data and Key Metrics Changes - Q3 clear aligner revenues were $806 million, up 2.4% year-over-year and slightly up sequentially [5][19] - Q3 systems and services revenues were $190 million, down 8.6% sequentially and slightly down year-over-year [21][22] - Q3 clear aligner volume reached 648,000 cases, a 5% year-over-year increase [5][12] Market Data and Key Metrics Changes - Clear aligner volumes grew year-over-year in APAC and EMEA regions, while North America showed mixed results [9][12] - Q3 clear aligner volumes increased by 14.7% sequentially for teens and kids, driven by strong performance in APAC, North America, and Latin America [13][14] - DSO performance in EMEA showed double-digit growth year-over-year [12][13] Company Strategy and Development Direction - The company is focusing on enhancing digital workflow innovations and expanding its product portfolio, including new iTero Digital Solutions [6][7] - Align Technology aims to support doctors with localized marketing and education to navigate challenges in the U.S. dental market [36][37] - The company is committed to improving operational efficiency and capital structure through restructuring actions [35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth in clear aligners and digital scanning solutions, despite challenges in the North American retail channel [36][37] - The company anticipates Q4 2025 revenues to be between $1.025 billion and $1.045 billion, with expected growth in clear aligner volume and average selling price [32][33] - Management highlighted the importance of consumer confidence in driving demand and plans to leverage brand strength to support retail customers [64] Other Important Information - The company has partnered with Healthcare Finance Direct to enhance affordability for patients seeking Invisalign treatment [10][84] - As of September 30, 2025, cash and cash equivalents were $1,004.6 million, with a share repurchase program in place [29][30] Q&A Session Summary Question: Comments on early Q4 market conditions and ClinCheck launch impact on gross margins - Management noted positive sentiment from Q3 results and emphasized the efficiency improvements from the new ClinCheck technology [41][43] Question: Clarification on ASP trends and pricing environment - ASP was impacted by a mix shift towards lower-priced markets, but management expects improvements in Q4 due to seasonal factors [50][52] Question: Factors affecting North American retail demand - Management indicated that economic issues are affecting retail customers more than DSOs, and plans to enhance marketing efforts to support retail doctors [63][64] Question: Year-over-year growth in EMEA and APAC - Management confirmed double-digit growth in both regions, with strong performance across various countries [68][69] Question: Insights on the Healthcare Finance Direct partnership - The partnership is helping to increase patient financing options, with expectations for continued growth in Q4 and beyond [84] Question: Competitive landscape in China and VBP implications - Management is aware of the evolving competitive landscape and is positioning the company to adapt to potential changes [90][92]

Financial Data and Key Metrics Changes - Q3 total revenues were $996 million, reflecting a 1.8% year-over-year increase and a 1.7% sequential decrease [5][20] - Q3 non-GAAP operating margin was 23.9%, exceeding the outlook of approximately 22% [5][28] - Q3 net income per diluted share was $2.61, up $0.11 sequentially and up $0.26 year-over-year [30] Business Line Data and Key Metrics Changes - Q3 clear aligner revenues were $806 million, a 2.4% year-over-year increase [6][20] - Q3 systems and services revenues were $190 million, down 8.6% sequentially and down 0.6% year-over-year [22][25] - Q3 clear aligner volume was 648,000 cases, a 5% year-over-year increase [6][9] Market Data and Key Metrics Changes - Clear aligner volumes increased year-over-year in APAC and EMEA regions, while North America showed mixed results [10][14] - Q3 clear aligner volumes for teens and kids saw a 14.7% sequential increase, driven by strength in APAC, North America, and Latin America [14][15] - DSO performance grew double digits year-over-year, particularly in EMEA and APAC regions [13][14] Company Strategy and Development Direction - The company is focusing on enhancing digital workflow innovations and expanding its product portfolio to drive long-term growth [5][37] - Investments in AI-powered treatment planning and direct 3D printing of aligners are key to improving outcomes and efficiency [37] - The company aims to navigate headwinds in the U.S. dental market by supporting doctor customers with localized marketing and education [38] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth in clear aligners and digital scanning solutions, despite mixed results in the North American retail channel [37] - The company anticipates Q4 2025 worldwide revenues to be in the range of $1.025 billion to $1.045 billion, indicating sequential growth [33] - For fiscal 2025, the company expects clear aligner volume growth to be mid-single digits and revenue growth to be flat to slightly up from 2024 [34] Other Important Information - The company has partnered with Healthcare Finance Direct to enhance affordability for patients seeking Invisalign treatment [11][85] - As of September 30, 2025, cash and cash equivalents were $1.004 billion, with a share repurchase plan in place [30][31] Q&A Session Summary Question: Comments on early Q4 market conditions and ClinCheck launch impact on gross margins - Management noted positive sentiment from Q3 and highlighted the efficiency improvements expected from the new ClinCheck technology [42][44] Question: Clarification on ASP trends and pricing environment - ASP was impacted by geographic mix, with expectations for improvement in Q4 as Europe contributes more to total sales [51][53] Question: Factors affecting North American retail demand - Management indicated that economic issues are affecting retail customers more than DSOs, and efforts will focus on localized marketing to drive demand [64][65] Question: Year-over-year growth in EMEA and APAC markets - Management confirmed double-digit growth in both regions, with strong performance across various countries [70][72] Question: Insights on the Healthcare Finance Direct partnership - The partnership is helping to increase patient conversions, with more doctors utilizing the financing option [85] Question: Competitive landscape in China and VBP implications - Management is aware of the VBP developments and is positioning the company accordingly, though specifics remain unclear [90][91]

Financial Data and Key Metrics Changes - Total revenues for Q3 2025 were $995.7 million, up 1.8% year-over-year but down 1.7% sequentially [19][30] - Q3 non-GAAP operating margin was 23.9%, exceeding the outlook of approximately 22% [4][27] - Q3 gross margin was 64.2%, down 5.7 points sequentially and down 5.5 points year-over-year [23][24] - Q3 net income per share was $0.78, down from $1.71 sequentially and down from $1.55 year-over-year [29][30] Business Line Data and Key Metrics Changes - Clear aligner revenues were $805.8 million, up 2.4% year-over-year and slightly up sequentially [5][19] - Clear aligner volume reached 648,000 cases, increasing roughly 5% year-over-year [5][10] - Systems and services revenues were $189.9 million, down 8.6% sequentially and down 0.6% year-over-year [22][25] Market Data and Key Metrics Changes - Clear aligner volumes grew in EMEA and APAC regions, with strong performance in teens and kids categories [3][10] - North America retail channel performance remained mixed, with growth in DSO channels [4][11] - Q3 clear aligner volumes increased year-over-year for both orthodontists and GPs, driven by growth across adults, teens, and kids [10][12] Company Strategy and Development Direction - The company is focusing on driving consumer demand and patient conversion through partnerships with DSO [4][11] - Investment in AI-powered treatment planning software and digital scanning technology is aimed at improving efficiency and patient experience [38] - The company plans to navigate headwinds in the U.S. dental market by enhancing localized marketing and clinical support [39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth in clear aligner segments and digital scanning solutions despite mixed performance in North America [38] - The company anticipates Q4 2025 revenues to be in the range of $1,025 million to $1,045 million, indicating sequential growth [33] - For fiscal 2025, the company expects clear aligner volume growth to be mid-single digits and revenue growth to be flat to slightly up from 2024 [34][36] Other Important Information - The company repurchased approximately 0.5 million shares at an average price of $136.77 as part of a $200 million repurchase plan [30] - Cash and cash equivalents as of September 30, 2025, were $1,004.6 million, up sequentially but down year-over-year [30][31] - The company has stopped charging VAT to impacted customers in the UK as of August 1, 2025, adjusting prices accordingly [32] Q&A Session Summary Question: Comments on early Q4 and ClinCheck launch impact on gross margins - Management felt positive about Q3 performance and highlighted the efficiency improvements from the new ClinCheck technology [42][45] Question: ASP expectations and pricing environment - ASP was impacted by a mix shift towards lower-priced markets, but management expects it to improve in Q4 [50][52] Question: North American retail market challenges - Management noted consistent challenges in the North American retail market, emphasizing the need for localized marketing efforts [60][61] Question: Growth in the teen segment - Significant growth in the teen segment was attributed to new products and strong performance in China and EMEA [72][74] Question: DSO performance and its impact - DSOs accounted for about 25% of the business, showing robust growth compared to retail channels [75][77] Question: Healthcare Finance Direct partnership impact - The partnership is helping to increase patient financing options, with expectations for continued growth in Q4 [85] Question: Competitive landscape in China - Management is aware of potential VBP impacts and is positioning the company accordingly, focusing on expanding market reach [90][96]