Merit Medical Systems (MMSI) Q2 2025 Earnings Call July 30, 2025 05:00 PM ET Company ParticipantsFred Lampropoulos - Founder, Chairman, CEO & PresidentBrian Lloyd - Chief Legal Officer & Corporate SecretaryRaul Parra - CFO & TreasurerJayson Bedford - MD - Medical TechnologyConference Call ParticipantsJason Bednar - MD & Senior Research AnalystRobert Marcus - Senior AnalystSteven Lichtman - MD & Senior Analyst - Medical DevicesJames Sidoti - AnalystNone - AnalystMike Matson - MD - Senior Equity Research Anal ...

Financial Data and Key Metrics Changes - The company reported total revenue of $382.5 million, up 13% year over year on a GAAP basis and up 12.5% year over year on a constant currency basis [7][9] - Non-GAAP operating margin increased nearly 109 basis points year over year to 21.2%, representing the highest performance in the company's history as a public company [9] - Non-GAAP EPS grew by 10%, exceeding expectations, and free cash flow increased by 20% year over year to $70 million [9][34] Business Line Data and Key Metrics Changes - Cardiovascular segment sales grew by 10% and endoscopy segment sales increased by 81% [26] - Cardiac intervention product sales rose by 23%, with organic growth of approximately 10% [27] - Peripheral intervention products and custom procedure solutions saw sales increases of 6% and 4%, respectively [28] Market Data and Key Metrics Changes - U.S. sales increased by 17% on a constant currency basis, while international sales grew by 7% year over year [30] - Sales in China decreased by 6%, attributed to the broader macro environment [31][75] - The company expects low double-digit growth in EMEA and mid-teens growth in the Rest of the World region, with approximately 2% growth in the APAC region [37] Company Strategy and Development Direction - The company announced the acquisition of BioLife Delaware LLC for $120 million, aimed at enhancing its product offerings in hemostatic solutions [10][11] - A comprehensive marketing plan for the Rhapsody CIE was launched, focusing on raising awareness and expanding physician relationships [14] - The pricing strategy for Rhapsody CIE is based on a premium price relative to competitors, supported by clinical evidence demonstrating its efficacy [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong execution and revenue growth despite a dynamic global macro environment [10] - The company acknowledged a two-quarter delay in securing add-on reimbursement for the outpatient setting but maintained long-term growth expectations for Rhapsody CIE [24][39] - Management emphasized the importance of their reimbursement strategy and ongoing engagement with CMS to secure necessary approvals [23][49] Other Important Information - The company updated its 2025 financial guidance, expecting GAAP net revenue growth of 10% to 11% and non-GAAP diluted EPS in the range of $3.52 to $3.72 [36][40] - The anticipated impact of tariffs on the cost of goods is expected to be significantly lower than previously forecasted [41][42] Q&A Session Summary Question: Clarification on Rhapsody reimbursement process - Management clarified that they applied for a new technology APC assignment but did not receive it, and they plan to submit for TPT by September 1 [49][50] Question: Confidence in securing TPT - Management expressed high confidence in meeting TPT guidelines and emphasized the strength of their product and data [62] Question: Sales performance in cardiac intervention - Management attributed the growth to internal product development and the strategic acquisition of Cook Medical, expecting continued strong performance [94][96]