Core Insights - Align Technology, Inc. (ALGN) reported fourth-quarter 2025 adjusted earnings per share (EPS) of $3.29, a 34.8% increase year over year, exceeding the Zacks Consensus Estimate by 10.1% [1] - Full-year adjusted EPS reached $10.51, reflecting a 12.6% increase from 2024, also surpassing estimates by 2.8% [1] - Total revenues for Q4 were $1.05 billion, up 5.3% year over year, beating the Zacks Consensus Estimate by 1.33% [1] Revenue Performance - Full-year revenues totaled $4.03 billion, a 0.9% increase from 2024, exceeding the Zacks Consensus Estimate by 0.2% [2] - Clear Aligner segment revenues rose 5.5% year over year to $838.1 million, supported by a record volume of 676.9 thousand cases, which was 7.7% higher than the previous year [3] - Imaging Systems & CAD/CAM Services revenues increased 4.2% to $209.4 million, driven by higher volumes and the adoption of the iTero lumina scanner [4] Margin Analysis - Gross profit for Q4 was $683.6 million, down 1.9% year over year, with gross margin contracting 477 basis points to 65.3% due to a 22% increase in the cost of net revenues [5] - Operating income totaled $158.9 million, down 10.3% year over year, with operating margin contracting 263 basis points to 15.2% [5] Financial Position - At the end of Q4, cash and cash equivalents stood at $1.09 billion, up from $1.04 billion at the end of 2024 [6] - Cumulative net cash provided by operating activities was $593.2 million, compared to $738.2 million at the end of 2024 [6] Stock Activity - During the reported quarter, the company repurchased approximately 0.7 million shares at an average price of $142.87 per share, with $831.2 million remaining for future repurchases under the $1.0 billion program [8] Future Outlook - For 2026, Align Technology expects worldwide revenue growth of 3%-4% year over year, with Clear Aligner volume growth projected in the mid-single digits [9] - The Zacks Consensus Estimate for 2026 revenues is $4.18 billion, suggesting a 3.8% growth year over year [9] - For Q1 2026, the company anticipates revenues between $1.010 billion and $1.030 billion, reflecting a 3%-5% year-over-year increase [10] Product Developments - The company launched the Invisalign System with mandibular advancement in the Philippines and Thailand, aimed at correcting Class II skeletal and dental issues [12] - Continued piloting of Exocad ART in several European markets is planned for broader rollout this year [12]

Core Insights - Align Technology (ALGN) is expected to report quarterly earnings of $2.99 per share, a 22.5% increase year-over-year, with revenues projected at $1.03 billion, reflecting a 3.9% year-over-year growth [1] Earnings Estimates - Over the last 30 days, the consensus EPS estimate for the quarter has been revised upward by 1.1%, indicating analysts' reassessment of their initial forecasts [2] - Changes in earnings estimates are crucial for predicting investor reactions, as empirical studies show a strong correlation between earnings estimate revisions and short-term stock performance [3] Key Metrics Projections - Analysts estimate 'Net revenues- Imaging Systems and CAD/CAM Services' to be $208.31 million, representing a 3.7% increase from the previous year [5] - 'Net revenues- Clear Aligner' are forecasted to reach $825.06 million, indicating a year-over-year change of 3.9% [5] - The consensus for 'Clear Aligner Shipments' is projected at 655, compared to 629 in the same quarter last year [5] Stock Performance - Align Technology shares have recorded a return of +2.2% over the past month, outperforming the Zacks S&P 500 composite's +1.8% change [6] - With a Zacks Rank of 2 (Buy), ALGN is expected to outperform the overall market in the upcoming period [6]

Core Viewpoint - Align Technology reported a mixed performance in its Q3 2025 earnings, with adjusted EPS growth but significant declines in GAAP EPS and gross margins, leading to a cautious outlook for future revenue growth and margins [2][5][9]. Financial Performance - Adjusted EPS for Q3 2025 was $2.61, an increase of 11.1% year-over-year, exceeding the Zacks Consensus Estimate by 10.1% [2] - GAAP EPS fell to 78 cents, down 49.7% from $1.55 in Q3 2024 [2] - Total revenues increased by 1.8% year-over-year to $995.7 million, surpassing the Zacks Consensus Estimate by 2.5% [3] - Gross profit decreased by 6.2% year-over-year to $639.2 million, with gross margin contracting by 552 basis points to 64.2% due to a 20.4% rise in the cost of net revenues [5] Segment Performance - Clear Aligner segment revenues rose by 2.4% year-over-year to $805.8 million, benefiting from a 1.6% favorable foreign exchange impact [4] - Imaging Systems & CAD/CAM Services revenues fell by 0.6% to $189.9 million, also experiencing a favorable currency impact of 1.4% [4] Cost and Expenses - SG&A expenses decreased by 3.8% to $417.8 million, while R&D expenses increased by 9.4% to $93.3 million [5] - Operating income was $128.1 million, down 21.1% year-over-year, with operating margin contracting by 374 basis points to 12.9% [5] Cash Position and Stock Repurchase - The company ended Q3 with cash and cash equivalents of $1.00 billion, up from $901.2 million at the end of Q2 [6] - Approximately 0.5 million shares were repurchased at an average price of $136.77 per share during the quarter, following a $200 million repurchase plan [7][8] Future Outlook - For full-year 2025, Align Technology expects Clear Aligner revenue growth to be flat to slightly up from 2024, with a Zacks Consensus Estimate of $4.01 billion, indicating a 0.2% year-over-year growth [9] - The GAAP operating margin is projected to be between 13.6% and 13.8% [9] - For Q4 2025, worldwide revenues are anticipated to be between $1.03 billion and $1.05 billion, with a consensus estimate of $1.04 billion [10] Market Reaction and Estimates - Following the earnings announcement, ALGN stock rose by 15.1% in after-market trading [3] - However, there has been a downward trend in estimates since the earnings release, indicating a cautious sentiment among investors [11][13]

Core Insights - Align Technology, Inc. (ALGN) reported third-quarter 2025 adjusted earnings per share (EPS) of $2.61, an increase of 11.1% year-over-year, exceeding the Zacks Consensus Estimate by 10.1% [1] - The company's total revenues for the quarter reached $995.7 million, reflecting a year-over-year growth of 1.8% and surpassing the Zacks Consensus Estimate by 2.5% [2] Revenue Breakdown - The Clear Aligner segment generated revenues of $805.8 million, up 2.4% year-over-year, benefiting from a favorable foreign exchange impact of 1.6% [3] - Revenues from Imaging Systems & CAD/CAM Services decreased by 0.6% to $189.9 million, also experiencing a favorable currency impact of 1.4% [3] Margin Analysis - Gross profit for the quarter was $639.2 million, down 6.2% year-over-year, with gross margin contracting by 552 basis points to 64.2% due to a 20.4% increase in the cost of net revenues [4] - Operating income fell to $128.1 million, a decline of 21.1% year-over-year, with the operating margin contracting by 374 basis points to 12.9% [4] Financial Position - At the end of the third quarter, the company had cash and cash equivalents of $1.00 billion, an increase from $901.2 million at the end of the second quarter [5] - Cumulative net cash provided by operating activities was $370 million, down from $452.1 million at the end of the third quarter of 2024 [5] Stock Repurchase Activity - During the reported quarter, ALGN repurchased approximately 0.5 million shares at an average price of $136.77 per share, following a $200.0 million open market repurchase plan announced on August 5, 2025 [6][7] Future Outlook - For the full year 2025, ALGN expects Clear Aligner revenue growth to be flat to slightly up from 2024, with the Zacks Consensus Estimate for 2025 revenues at $4.01 billion, indicating a 0.2% year-over-year growth [8] - The company anticipates fourth-quarter revenues to be in the range of $1.03 billion to $1.05 billion, with the Zacks Consensus Estimate at $1.04 billion [9] Market Performance - Following the earnings announcement, ALGN's stock rose by 15.1% in after-market trading [2] - The company reported growth in Clear Aligner volume across APAC, EMEA, and Latin American regions, driven by increased utilization among orthodontists and general practitioners [11]