Core Viewpoint - Zimmer Biomet Holdings, Inc. reported mixed results for Q1 2025, with adjusted EPS beating estimates but showing a year-over-year decline, while revenues exceeded expectations and showed slight growth [1][11]. Financial Performance - Adjusted EPS for Q1 2025 was $1.81, beating the Zacks Consensus Estimate by 2.3%, but down 6.7% year over year [1]. - Reported EPS was 91 cents, reflecting an 8.3% increase year over year [2]. - Q1 net sales reached $1.91 billion, a 1.1% increase year over year, and up 2.3% at constant exchange rates (CER), exceeding the Zacks Consensus Estimate by 1% [3]. Revenue Breakdown - U.S. sales totaled $1.11 billion, up 1.3% year over year, while international sales were $795.5 million, up 0.7% year over year and 3.7% at CER [4]. - Revenue by segment showed: - Knees: $792.9 million, up 1.9% at CER [5]. - Hips: $495.8 million, up 2.4% at CER [5]. - S.E.T.: $470.5 million, up 4.9% at CER [6]. - Technology & Data, Bone Cement and Surgical: $149.9 million, down 3.5% at CER [6]. Margin Analysis - Adjusted gross margin was 71.2%, a contraction of 168 basis points [7]. - Selling, general and administrative expenses rose 3.1% to $758.8 million, while R&D expenses increased 2.5% to $110.6 million [7]. - Adjusted operating margin contracted 254 basis points to 25.7% [7]. Cash Position - Cash and cash equivalents at the end of Q1 were $1.38 billion, up from $525.5 million at the end of Q4 2024 [8]. - Cumulative net cash from operating activities was $382.8 million, compared to $228 million in the previous year [8]. 2025 Outlook - The company expects reported revenue growth for 2025 to be between 5.7% and 8.2% year over year, an increase from earlier guidance of 1% to 3.5% [9]. - Adjusted EPS for the full year is projected to be in the range of $7.90 to $8.10 [9]. - The Zacks Consensus Estimate for 2025 adjusted EPS is $8.22 on revenues of $7.88 billion [10]. Strategic Insights - The company is gaining momentum in the U.S. Hips market, supported by new product offerings [13]. - The acquisition of Paragon 28 is expected to enhance innovation and expand the S.E.T. business into high-growth segments [13].