Q3 2025 OrthoPediatrics Corp Earnings Call

October 28, 2025

Operator: Will be facilitating a question and answer session towards the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the conference over to Philip Taylor from the Gilmartin Group for a few introductory comments.

Operator: Will be facilitating a question-and answer session towards the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the conference over to Philip Taylor from the Gilmartin Group for a few introductory comments.

Operator: Will be facilitating a question-and-answer session towards the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the conference over to Tripp Taylor from the Gilmartin Group for a few introductory comments.

Tripp Taylor: Thank you for joining today's call. With me from the company are David Bailey, President and Chief Executive Officer, and Fred Hite, Chief Operating and Financial Officer. Before we begin today, let me remind you that the company's remarks include forward-looking statements within the meaning of federal security laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to numerous risks and uncertainties, and the company's actual results may differ materially. For discussion of risk factors, I encourage you to review the company's most recent annual report on Form 10-K, which was filed with the SEC on 5 March 2025, and its subsequent quarterly reports on Form 10-Q. During the call today, management will also discuss certain non-GAAP financial measures, which are supplemental measures of performance.

Philip Taylor: Thank you for joining today's call. With me from the company are David Bailey, President and Chief Executive Officer, and Fred Hite, Chief Operating and Financial Officer. Before we begin today, let me remind you that the company's remarks include forward-looking statements within the meaning of Federal Securities laws, including the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to numerous risks and uncertainties, and the company's actual results may differ materially. For a discussion of risk factors, I encourage you to review the company's most recent annual report on Form 10-K, which was filed with the SEC on 5 March 2025, and its subsequent quarterly reports on Form 10-Q. During the call today, management will also discuss certain non-GAAP financial measures, which are supplemental measures of performance.

Tripp Taylor: The company believes these measures provide useful information for investors in evaluating its operations period over period. For each non-GAAP financial measure referenced on this call, the company has included a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure in the third-quarter earnings release. Please note that the non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for OrthoPediatrics' financial results prepared in accordance with GAAP. In addition, the content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast today, 28 October 2025. Except as required by law, the company undertakes no obligation to revise or update any statement to reflect events or circumstances taking place after the date of this call.

Philip Taylor: The company believes these measures provide useful information for investors in evaluating its operations period over period. For each non-GAAP financial measure referenced on this call, the company has included a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure in the Q3 earnings release. Please note that the non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitute for OrthoPediatrics' financial results prepared in accordance with GAAP. In addition, the content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast today, 28 October 2025. Except as required by law, the company undertakes no obligation to revise or update any statements to reflect events or circumstances taking place after the date of this call.

Tripp Taylor: With that, I would like to turn the call over to David Bailey, President and Chief Executive Officer.

Philip Taylor: With that, I would like to turn the call over to David Bailey, President and Chief Executive Officer.

David Bailey: Thanks, Tripp. Good afternoon, everyone, and thank you for joining us today. We are proud to start this call with our typical and most meaningful performance metric. In the third quarter, we supported the treatment of more than 37,100 children, increasing our total impact to approximately 1.3 million kids' health. With too few solutions designed specifically for children and the clinicians who care for them, pediatric healthcare has long faced critical gaps. At OrthoPediatrics, we are committed to addressing these unmet needs, and our mission to close those gaps and reshape the future of pediatric care remains clearer than ever. We have made tremendous progress in this market, but there is still a substantial market opportunity ahead. In the third quarter, we saw strength in all areas of our business, excluding 7D capital sales and LATAM international stocking and set sales.

David Bailey: Thanks, Tripp. Good afternoon, everyone. Thank you for joining us today. We are proud to start this call with our typical and most meaningful performance metric. In Q3, we supported the treatment of more than 37,100 children, increasing our total impact to approximately 1.3 million kids helped. With too few solutions designed specifically for children and the clinicians who care for them, pediatric healthcare has long faced critical gaps. At OP, we are committed to addressing these unmet needs. Our mission to close those gaps and reshape the future of pediatric care remains clearer than ever. We have made tremendous progress in this market. There is still a substantial market opportunity ahead. In Q3, we saw strength in all areas of our business, excluding 7D Capital sales and LATAM International stocking and set sales.

David Bailey: In fact, we saw total third-quarter global revenue growth, excluding 7D capital sales, of 17%, and domestic revenue growth, excluding 7D capital sales, of 19%. Both trauma and deformity and scoliosis implant sales were strong, as we saw a very normal summer selling season, and OPSB growth continues to be extremely robust, with growth in excess of 20%. As a reminder, OPSB sales are approximately 80% trauma and deformity and 20% scoliosis, and we saw strong growth in both areas. As we highlighted in our preliminary announcement, our revenue results fell short of our expectations, driven by two isolated factors: 7D capital sales that were expected in the quarter did not close prior to the quarter end, and headwinds from stocking and set sales in Latin and South America have continued longer than expected.

David Bailey: In fact, we saw total Q3 global revenue growth excluding 7D Capital sales of 17%, and domestic revenue growth excluding 7D Capital sales of 19%. Both T&D and scoliosis implant sales were strong as we saw a very normal summer selling season, and OPSB growth continues to be extremely robust, with growth in excess of 20%. As a reminder, OPSB sales are approximately 80% T&D and 20% scoliosis, and we saw strong growth in both areas. As we highlighted in our preliminary announcement, our revenue results fell short of our expectations, driven by two isolated factors. 7D Capital sales that were expected in the quarter did not close prior to the quarter end, and headwinds from stocking and set sales in Latin and South America have continued longer than expected.

David Bailey: Although these two areas did not produce the results we wanted, these are two of our lower-margin segments, and because the rest of the business remained strong, we still delivered high gross margins and profitability in line with our expectations. Looking beyond the top line for the third quarter, we are pleased to see a significant 56% improvement in adjusted EBITDA, growing to $6.2 million. In addition, we also saw huge progress with our free cash flow usage, which was dramatically lower in the third quarter, decreasing $8.2 million. Both of these metrics have been a focal point of our strategy, and we are succeeding in delivering our goals. Touching briefly on our outlook, as announced previously, for the full year, we now expect revenue to range from $233.5 million to $234.5 million.

David Bailey: Although these two areas did not produce the results we wanted, these are two of our lower margin segments, and because of the rest of the business remained strong, we still delivered high gross margins and profitability in line with our expectations. Looking beyond the top line for Q3, we are pleased to see a significant 56% improvement in Adjusted EBITDA, growing to $6.2 million. In addition, we also saw huge progress with our free cash flow usage, which was dramatically lower in Q3, decreasing $8.2 million. Both of these metrics have been a focal point of our strategy. We are succeeding in delivering our goals. Touching briefly on our outlook.

David Bailey: As announced previously, for the full year, we now expect revenue to range from $233.5 to 234.5 million. Adjusted EBITDA is still expected to be $15 to 17 million, and we are on track to deploy $15 million in sets and generate positive free cash flow in Q4. Even though our top-line expectations have been adjusted, we are maintaining our profitability and free cash flow outlook. As we drive toward our profitability goals, our core business, consisting of Trauma and Deformity, scoliosis implants, Specialty Bracing, and our international agencies generates higher margins and better free cash flow than the capital sales and LATAM stocking and set sales.

David Bailey: Adjusted EBITDA is still expected to be $15 to $17 million, and we are on track to deploy $15 million in sets and generate positive free cash flow in Q4. Even though our top-line expectations have been adjusted, we are maintaining our profitability and free cash flow outlook. As we drive toward our profitability goals, our core business, consisting of trauma and deformity and scoliosis implants, specialty bracing, and our international agencies, generates higher margins and better free cash flow than the capital sales and LATAM stocking and set sales. Our core businesses are positioned to remain the key engines of revenue growth, adjusted EBITDA, and free cash flow, and we are confident in our forecast of generating positive free cash flow in Q4 and break-even in 2026.

David Bailey: Our core businesses are positioned to remain the key engines of revenue growth, Adjusted EBITDA, and free cash flow. We are confident in our forecast of generating positive free cash flow in Q4 and breakeven in 2026. Turning to our segments. In Q3 2025, the T&D business grew by 17% in the quarter, driven by continued strong market share gains across several product lines. More specifically, growth was led by strong performances in trauma implants and a return to normal scheduling in the elective limb deformity business. Extremely strong X-Fix growth and the continued high growth of OPSB were the highlights in the quarter. Taking a closer look at trauma, we saw particularly strong revenue gains driven by continued rapid adoption of PMP Femur, PMP Tibia, Orth-X, and the Bioretec ActivaScrew.

David Bailey: Turning to our segments, in the third quarter of 2025, the T&D business grew by 17% in the quarter, driven by continued strong market share gains across several product lines. More specifically, growth was led by strong performances in trauma implants and a return to normal scheduling in the elective limb deformity business. Extremely strong ex-fix growth, and the continued high growth of OPSB, were the highlights in the quarter. Taking a closer look at trauma, we saw particularly strong revenue gains driven by continued rapid adoption of PMP Femur, PMP Tibia, Orthex, and the BioRetech Activis group.

David Bailey: Looking closer at the 3P platform, following the FDA approval of the 3P Pediatric Plating Platform Hip System and its first surgical cases, we are seeing consistent case growth, which we expect to continue through the remainder of the year and to ramp aggressively as we begin the full launch of this product in 2026. Additionally, we are pleased to have recently accomplished another milestone for this platform, as we have just announced the next 3P system in the series, 3P Small & Mini, has been approved by the FDA. This approval comes ahead of schedule, and we now expect to complete the first cases in the beginning of next year. With the 3P platform, we expect to launch new systems each year for the next several years, bolstering both trauma and limb deformity revenue.

David Bailey: Looking closer at the 3P platform, following the FDA approval of the 3P Pediatric Plating Platform Hip system and its first surgical cases, we are seeing consistent case growth, which we expect to continue through the remainder of the year and to ramp aggressively as we begin the full launch of this product in 2026. Additionally, we are pleased to have recently accomplished another milestone for this platform, as we have just announced the next 3P system in the series, 3P Small-Mini System, has been approved by the FDA. This approval comes ahead of schedule, and we now expect to complete the first cases in the beginning of next year. With the 3P platform, we expect to launch new systems each year for the next several years, bolstering both trauma and limb deformity revenue.

David Bailey: TNB remains a core growth engine for our business, powered by our expanding scale, ongoing market share gains, and a steady cadence of innovation focused on unmet clinical needs. We have established ourselves as a market leader in TNB, and we are executing with confidence, especially as we see more competitors exiting the space by removing pediatric-specific product lines. Our OPSB specialty bracing strategy continues to build momentum, and with continued execution of our operational goals, our confidence in this long-term opportunity only strengthens. This segment represents a high-potential, capital-efficient growth avenue and is an integral part of our company strategy. We will continue our efforts to drive targeted territory expansion, accelerate R&D efforts, and continue scaling our sales force. As a reminder, when we acquired Boston OMP in January 2024, there were 26 operational clinics.

David Bailey: T&D remains a core growth engine for our business, powered by our expanding scale, ongoing market share gains, and a steady cadence of innovation focused on unmet clinical needs. We have established ourselves as a market leader in T&D, and we are executing with confidence, especially as we see more competitors exiting the space by removing pediatric-specific product lines. Our OPSB specialty bracing strategy continues to build momentum, and with continued execution of our operational goals, our confidence in this long-term opportunity only strengthens. This segment represents a high-potential, capital-efficient growth avenue, and is an integral part of our company strategy. We will continue our efforts to drive targeted territory expansion, accelerate R&D efforts, and continue scaling our sales force. As a reminder, when we acquired Boston O&P in January of 2024, there were 26 operational clinics.

David Bailey: As previously reported, since then, we have expanded to more than 40 clinics, entered into eight new territories, and launched several new products. Our preliminary expectations for new clinic return on investments, 25% for new clinic acquisitions and 40% for new greenfield clinics, are being realized. During the quarter, we expanded our footprint into two very large markets, New York City and California. We expanded Denver and Ohio, and for the first time, we expanded internationally with a clinic in Ireland. These latest additions continue to reinforce the importance and need for OPSB clinics, and we anticipate that the strong wave of clinic expansion opportunities, driven by high customer demand and a robust pipeline, will continue. In addition to expansion opportunities, same-store sales growth has been increasing and generating positive momentum. Our OPSB strategy is delivering strong results and has proven to be a highly efficient expansion path for OrthoPediatrics.

David Bailey: As previously reported, since then, we have expanded to more than 40 clinics, entered into 8 new territories, and launched several new products. Our preliminary expectations for new clinic return on investments, 25% for new clinic acquisitions and 40% for new greenfield clinics are being realized. During the quarter, we expanded our footprint into 2 very large markets, New York City, and California. We expanded Denver, and Ohio. For the first time, we expanded internationally with a clinic in Ireland. These latest additions continue to reinforce the importance and need for OPSB clinics, and we anticipate that the strong wave of clinic expansion opportunities driven by high customer demand and a robust pipeline will continue. In addition to expansion opportunities, same-store sales growth has been increasing and generating positive momentum.

David Bailey: Our OPSB strategy is delivering strong results and has proven to be a highly efficient expansion path for OrthoPediatrics. Our presence outside the operating room allows us to create deeper partnerships with our customers. This powerful strategy is extending our leadership position in pediatric orthopedics. We remain focused on executing our strategy with precision as we work towards securing a leading share in this growing market. Moving to the scoliosis business. Our growth of 4% seen in scoliosis this quarter was led by strong US scoliosis implant and scoliosis OPSB growth, offset by $2.3 million lower 7D capital sales. US scoliosis growth continues to be led by new users adopting OrthoPediatrics technology, including RESPONSE, as well as Pulser from past 7D placements. As mentioned, the underlying OUS business grew nicely but was negatively affected by reduced stocking and set sales in LATAM, primarily Brazil.

David Bailey: Our presence outside the operating room allows us to create deeper partnerships with our customers. This powerful strategy is extending our leadership position in pediatric orthopedics. We remain focused on executing our strategy with precision as we work toward securing a leading share in this growing market. Moving to the scoliosis business, our growth of 4% seen in scoliosis this quarter was led by strong US scoliosis implant and scoliosis OPSB growth, offset by $2.3 million lower 7D capital sales. US scoliosis growth continues to be led by new users adopting OrthoPediatrics technology, including Response, as well as pull-through from past 7D placements. As mentioned, the underlying OUS business grew nicely but was negatively affected by reduced stocking and set sales in LATAM, primarily Brazil. We expect this will continue for the next several quarters but are working on an improvement plan to implement in the near future.

David Bailey: We expect this will continue for the next several quarters but are working on an improvement plan to implement in the near future. 7D sales in the quarter were impacted by increased variability in the timing of unit placements that caused delayed capital sales, and the corresponding revenue from those placements had a significant impact on quarterly sales and overall growth. Typically, there are a few 7D unit sales within the quarter. For Q3 2025, there were 0 unit sales. This compares to our strongest 7D unit sales results in Q3 2024. We still expect 7D to be a revenue driver for us, but we cannot predict how much and which quarter sales will fall in.

David Bailey: 7D sales in the quarter were impacted by increased variability in the timing of unit placements that caused delayed capital sales, and the corresponding revenue from those placements had a significant impact on quarterly sales and overall growth. Typically, there are a few 7D unit sales within the quarter, but for the third quarter 2025, there were zero unit sales. This compares to our strongest 7D unit sales results in the third quarter of 2024. We still expect 7D to be a revenue driver for us, but we cannot predict how much and which quarter sales will fall in. To minimize the impact of lumpy 7D unit sales, we have adjusted our outlook so there is minimal impact on our expectations, which does result in negative growth assumptions from this segment.

David Bailey: To minimize the impact of lumpy 7D unit sales, we have adjusted our outlook so there is minimal impact on our expectations, which does result in negative growth assumptions from this segment. Looking at our EOS product portfolio. We are pleased to see that our portfolio expansion strategy continues to be effective. In particular, we are seeing positive trends with our recently launched VerteGlide spinal growth system for skeletally immature patients. Following the first completed cases in August, we are seeing solid adoption of VerteGlide through the limited release, and we remain on target for the full market release in the coming months. We are excited about the progress made within this portfolio and look forward to progressing the remainder of our EOS products. Moving to international.

David Bailey: Looking at our EOS product portfolio, we are pleased to see that our portfolio expansion strategy continues to be effective. In particular, we are seeing positive trends with our recently launched Vertiglide Spinal Growth System for skeletally immature patients. Following the first completed cases in August, we are seeing solid adoption of Vertiglide through the limited release, and we remain on target for the full market release in the coming months. We are excited about the progress made within this portfolio and look forward to progressing the remainder of our EOS products. Moving to international, international underlying sales were solid in the quarter due to extremely strong demand and surgical volume in EMEA and APAC, offset by unfavorable growth from LATAM. The underlying revenue largely comes through our sales agencies and represents a good reflection of high surgeon usage and higher margin replenishment revenue.

David Bailey: International underlying sales were solid in the quarter due to extremely strong demand and surgical volume in EMEA and APAC, offset by unfavorable growth from LATAM. The underlying revenue largely comes through our sales agencies and represents a good reflection of high surgeon usage and higher margin replenishment revenue. We are particularly excited to see our EMEA scoliosis launch going so well and are eagerly awaiting the EU MDR approval of our 4.5 scoliosis system, along with multiple other approvals expected before the end of year. On the other hand, the headwinds in LATAM have persisted longer than we anticipated. In an effort to focus on improved cash metrics, we have made the conscious decision to limit new stocking and set sales to South America.

David Bailey: We are particularly excited to see our EMEA scoliosis launch going so well and are eagerly awaiting the EU MDR approval of our Response 4.5 Scoliosis System, along with multiple other approvals expected for the end of year. On the other hand, the headwinds in Latin America have persisted longer than we anticipated. In an effort to focus on improved cash metrics, we have made the conscious decision to limit new stocking and set sales to South America. This dynamic continues to play out and negatively impacts our growth, particularly in Brazil. We believed that at this point, our Latin America business would be in a more stable position and that we would see the benefit of growth in Latin and South America again. However, we experienced continued disruption in sales, largely related to timing of large stocking and set orders.

David Bailey: This dynamic continues to play out and negatively impacts our growth, particularly in Brazil. We believed that at this point, our LatAm business would be in a more stable position and that we would see the benefit of growth in Latin and South America again. However, we experienced continued disruption in sales, largely related to timing of large stocking and set orders. We're working towards solutions, but expect there to be some variability here moving forward, which we have reflected in our outlook. In summary, we are proud of the way the business performed, excluding 7D and LatAm. OrthoPediatrics continues to lead the pediatric orthopedic market and provide comprehensive solutions to support the care of children. We remain focused on execution across the business, including scaling of OPSB, leveraging previous set deployments, and launching innovative new products.

David Bailey: We're working toward solutions but expect there to be some variability here moving forward, which we have reflected in our outlook. In summary, we are proud of the way the business performed, excluding 7D and Latin America. OrthoPediatrics continues to lead the pediatric orthopedic market and provide comprehensive solutions to support the care of children. We remain focused on execution across the business, including scaling of OPSB, leveraging previous set deployments, and launching innovative new products. This strategy will support revenue growth, increase adjusted EBITDA, while meaningfully reducing cash burn as we work towards achieving free cash flow break-even in 2026. Lastly, we believe our strategy positions OrthoPediatrics to help more children than ever before. With that, I'd like to turn the call over to Fred to provide more details on our financial results. Fred? Thanks, Dave.

David Bailey: This strategy will support revenue growth, increase Adjusted EBITDA, while meaningfully reducing cash burn as we work towards achieving free cash flow breakeven in 2026. Lastly, we believe our strategy positions OrthoPediatrics to help more children than ever before. With that, I'd like to turn the call over to Fred to provide more details on our financial results. Fred?

Fred Hite: Thanks, Dave. Taking a closer look at the P&L, our Q3 2025 worldwide revenue of $61.2 million increased 12% compared to Q3 2024. Growth in the quarter was driven primarily by strong performance across Trauma and Deformity, scoliosis, and OPSB, offset by a decline in 7D unit sales and LatAm stocking and set sales. US revenue was $48.7 million, a 14% increase from Q3 2024, representing 80% of total revenue. Growth in the quarter was primarily driven by Trauma and Deformity, scoliosis, and OPSB, offset by a decline in 7D unit sales. We generated total international revenue of $12.5 million, representing growth of 6% compared to Q3 2024 and representing 20% of our total revenue.

David Bailey: Taking a closer look at the P&L, our third quarter of 2025 worldwide revenue of $61.2 million increased 12% compared to the third quarter of 2024. Growth in the quarter was driven primarily by strong performance across trauma and deformity, scoliosis, and OPSB, offset by a decline in 7D unit sales and Latin America stocking and set sales. US revenue was $48.7 million, a 14% increase from the third quarter of 2024, representing 80% of total revenue. Growth in the quarter was primarily driven by trauma and deformity, scoliosis, and OPSB, offset by a decline in 7D unit sales. We generated total international revenue of $12.5 million, representing growth of 6% compared to the third quarter of 2024 and representing 20% of our total revenue. Growth in the quarter was primarily led by increased procedure volumes, partially offset by lower stocking and set sales to Latin America.

Fred Hite: Growth in the quarter was primarily led by increased procedure volumes, partially offset by lower stocking and set sales to LatAm. In Q3 2025, Trauma and Deformity global revenue of $44.1 million increased 17% compared to the prior year period. Growth was primarily driven by strong growth across multiple product lines, specifically our Cannulated Screws, PMP Femur, PMP Tibia, DF2, and OPSB. In Q3 2025, Scoliosis global revenue of $16.3 million increased 4% compared to the prior year period. Growth was primarily driven by increased sales of RESPONSE 5.5/6.0 and revenue generated from FIREFLY, offset by a decline in 7D unit sales.

David Bailey: In the third quarter of 2025, trauma and deformity global revenue of $44.1 million increased 17% compared to the prior year period. Growth was primarily driven by strong growth across multiple product lines, specifically our cannulated screws, Pediatric Nailing Platform | Femur, Pediatric Nailing Platform | Tibia, DF2, and OPSB. In the third quarter of 2025, scoliosis global revenue of $16.3 million increased 4% compared to the prior year period. Growth was primarily driven by increased sales of Response 5560 and revenue generated from Firefly. Offset by a decline in 7D unit sales. Finally, sports medicine other revenue in the third quarter of 2025 was $0.9 million, compared to $1.3 million in the prior year period. Touching briefly on a few key metrics. For the third quarter of 2025, gross profit margin was 74% compared to 73% for the third quarter of 2024.

Fred Hite: Finally, sports medicine other revenue in Q3 2025 was $0.9 million compared to $1.3 million in the prior year period. Touching briefly on a few key metrics. For Q3 2025, gross profit margin was 74% compared to 73% for Q3 2024. The increase in gross margin was primarily driven by favorable product sales mix as a result of lower 7D unit sales and lower stocking and set sales to LatAm, which generate lower gross margin profit. Total operating expenses increased $9.0 million or 19% compared to the prior year period to $54.7 million in Q3 2025.

David Bailey: The increase in gross margin was primarily driven by favorable product sales mix as a result of lower 7D unit sales and lower stocking and set sales to LATAM, which generate lower gross margin profit. Total operating expenses increased $9.0 million, or 19% compared to the prior year period, to $54.7 million in the third quarter of 2025. The increase was mainly driven by $2.3 million of restructuring charges, $2.3 million of impairment charges, increased non-cash stock compensation, as well as the ongoing growth of the OPSB clinics. Sales and marketing expenses increased $1.9 million, or 11% compared to the prior year period, to $18.7 million in the third quarter of 2025. The increase was mainly driven by increased sales commission expense and an overall increase in volume of units sold.

Fred Hite: The increase was mainly driven by $2.3 million of restructuring charges, $2.3 million of impairment charges, increased non-cash stock compensation, as well as the ongoing growth of the OPSB clinics. Sales and marketing expenses increased $1.9 million or 11% compared to the prior year period to $18.7 million in Q3 2025. The increase was mainly driven by increased sales commission expense and an overall increase in volume of units sold. General and administrative expenses increased $2.9 million or 11% year-over-year to $29.2 million in Q3 2025. The Q3 increase was driven primarily by increased non-cash stock compensation, as well as the ongoing growth of the OPSB clinics.

David Bailey: General and administrative expenses increased $2.9 million, or 11% year over year, to $29.2 million in the third quarter of 2025. The third quarter increase was driven primarily by increased non-cash stock compensation, as well as the ongoing growth of the OPSB clinics. Intangible asset impairment recorded during the third quarter of 2025 was $2.3 million, related to our annual impairment test, where we determined the fair value of ApiFix, Tellos, and MedTech trademark assets, and Tellos customer relationship assets were below the carrying value. We recorded an impairment charge to reduce the carrying amount of the intangible assets to their estimated fair value. Restructuring charges recorded during the third quarter of 2025 were $2.3 million, related to the company's global restructuring plan started in the fourth quarter of 2024, aimed at improving operational efficiency, reducing operating costs, as well as reducing staffing.

Fred Hite: Intangible asset impairment recorded during Q3 2025 was $2.3 million related to our annual impairment test, where we determined the fair value of ApiFix, Telos, and MedTech trademark assets and Telos customer relationship assets were below the carrying value. We recorded an impairment charge to reduce the carrying amount of the intangible assets to their estimated fair value. Restructuring charges recorded during Q3 2025 was $2.3 million related to the company's global restructuring plan started in Q4 2024, aimed at improving operational efficiency, reducing operating costs, as well as reducing staffing. For Q3, we recorded additional restructuring expense as we continue to view structural changes required to drive down costs. We saw savings in Q3. We anticipate greater impact in Q4 and in 2026.

David Bailey: For the third quarter, we recorded additional restructuring expense as we continue to review structural changes required to drive down costs. We saw savings in the third quarter but anticipate greater impact in the fourth quarter and in 2026. Research and development expense decreased $0.2 million in the third quarter of 2025 due to timing of product development third-party invoices. Total other expense was $2.5 million for the third quarter of 2025 compared to $3.6 million of other expense for the same period last year. GAAP net loss per share for the period was $0.50 per basic and diluted share compared to $0.34 per basic and diluted share for the same period last year. Non-GAAP net loss per share for the period was $0.24 per basic and diluted share compared to $0.18 per basic and diluted share for the same period last year.

Fred Hite: Research and development expense decreased $0.2 million in Q3 2025 due to timing of product development third-party invoices. Total other expense was $2.5 million for Q3 2025, compared to $3.6 million of other expense for the same period last year. GAAP net loss per share for the period was $0.50 per basic and diluted share, compared to $0.34 per basic and diluted share for the same period last year. Non-GAAP net loss per share for the period was $0.24 per basic and diluted share, compared to $0.18 per basic and diluted share for the same period last year.

Fred Hite: Adjusted EBITDA was $6.2 million in Q3 2025, a 56% improvement when compared to $4.0 million in Q3 2024. We ended Q3 with $59.8 million in cash, short-term investments, and restricted cash. In Q3, we saw a significant improvement in free cash flow performance. For Q3, free cash flow usage was $3.4 million compared to $11.7 million of free cash flow usage for Q3 2024. Set deployment was $4.1 million in Q3 2025 compared to $5.3 million in Q3 2024. Turning to guidance.

David Bailey: Adjusted EBITDA was $6.2 million in the third quarter of 2025, a 56% improvement when compared to $4.0 million in the third quarter of 2024. We ended the third quarter with $59.8 million in cash, short-term investments, and restricted cash. In the third quarter, we saw a significant improvement in free cash flow performance. For the third quarter, free cash flow usage was $3.4 million, compared to $11.7 million of free cash flow usage for the third quarter of 2024. Set deployment was $4.1 million in the third quarter of 2025 compared to $5.3 million in the third quarter of 2024. Turning to guidance, as Dave mentioned, we adjusted our expectation for full year 2025 revenue to be in the range of $233.5 to 234.5 million, representing year-over-year growth of 14% to 15%.

Fred Hite: As Dave mentioned, we adjusted our expectation for full year 2025 revenue to be in the range of $233.5 to 234.5 million, representing year-over-year growth of 14% to 15%. We are reiterating the guidance that our full year gross margin will be within the range of 72% to 73%. We also continue to expect to generate between $15 to 17 million of Adjusted EBITDA in 2025. Additionally, we continue to expect approximately $15 million of new set deployed in 2025. This represents our continued focus on driving the business to free cash flow breakeven by 2026, and we anticipate delivering our first quarter of free cash flow positivity in Q4 of 2025. Operator, let's open the call for Q&A.

David Bailey: We are reiterating the guidance that our full year gross margin will be within the range of 72% to 73%. We also continue to expect to generate between $15 million to $17 million of adjusted EBITDA in 2025. Additionally, we continue to expect approximately $15 million of new set deployed in 2025. This represents our continued focus on driving the business to free cash flow break-even by 2026, and we anticipate delivering our first quarter of free cash flow positivity in the fourth quarter of 2025. Operator, let's open the call for Q&A. Thank you. Ladies and gentlemen, if you have a question or a comment at this time, please press star 11 on your telephone. If your question has been answered and you wish to move yourself from the queue, please press star 11 again. We will pause for a moment while we compile our Q&A roster.

Operator: Thank you. Ladies and gentlemen, if you have a question or a comment at this time, please press star one one on your telephone. If your question has been answered and you wish to remove yourself from the queue, please press star one one again. We will pause for a moment while we compile our Q&A roster. Our first question comes from David Turkaly with Citizens Bank. Your line is open.

David Bailey: Our first question comes from David Turckley with Citizens Bank. Your line is open. Hey, good evening. Dave, you made a comment. I thought I heard you make it, so I just wanted to clarify it. Something about competitors exiting the space. I was wondering, specifically, what were you referring to there? Yeah, good question, Dave. Listen, we see some of the big OEMs that have notified customers that they're pulling products that historically have been used in pediatric patient populations. We've seen that from J&J. We've seen that from Smith & Nephew in the last six months. More recently, J&J with a hip product that would be a competitor to 3P. We have really nice timing that we're coming out with a new hip system.

David Turkaly: Hey, good evening. Dave, you made a comment, I thought I heard you make it, so I just wanted to clarify it. Something about competitors exiting the space. I was wondering, like, specifically, what were you referring to there?

David Bailey: Yeah, good question, Dave. Listen, we see some of the big OEMs that have notified customers that they're pulling products that historically have been used in pediatric patient population. We've seen that from J&J, we've seen that from Smith+Nephew in the last six months. More recently, J&J with a hip product that would be a competitor to 3P. We have really nice timing that we're coming out with a new hip system and just, I think, you know, seeing a continued defocus of these, you know, pediatrics, in some of the large OEMs, which I think is not necessarily great overall for patients, but certainly good for us from a competitive standpoint.

David Bailey: I think seeing a continued defocus of these pediatrics in some of the large OEMs, which I think is not necessarily great overall for patients, but certainly good for us from a competitive standpoint. I know that you talked about sort of 12% being, I think, the new LRP limit or down, I guess, lower limit of growth. It seems like you're doing a pretty good job with these clinics. As we look ahead to the next couple of years, do you think there's an ability to possibly accelerate either the expansions of the openings on the OPSB side, maybe to accelerate that number? Thank you. Yeah, I think there is no question that there is extremely high demand for clinics. This year, I would say we've gotten a lot of experience in terms of the timing of accelerating those clinics and the timing of getting those clinics started.

David Turkaly: I know that you talked about sort of 12% being, I think, the new LRP, you know, limit or down, I guess, lower limit of growth. It seems like you're doing a pretty good job with these clinics, but as we look ahead to the next couple of years, do you think there's an ability to possibly accelerate either the expansions or openings on the OPSB side maybe to accelerate that number? Thank you.

David Bailey: Yeah. I think there is no question that there is extremely high demand for clinics. You know, this year I would say we've gotten a lot of experience in terms of the timing of accelerating those clinics and the timing of getting those clinics started. We're pleased with what we've seen so far, you can bet that if we have the opportunity to do more and do more faster, we would certainly want to do that. Certainly trying to balance also that against the P&L requirements of trying to drive to increase profitability. I think the demand is there, yeah, you could assume that if we have the opportunity to open more clinics, we would certainly want to do that.

David Bailey: We're pleased with what we've seen so far. You can bet that if we have the opportunity to do more and do more faster, we would certainly want to do that. Certainly trying to balance also that against the P&L requirements of trying to drive to increase profitability. I think the demand is there. Yeah, you could assume that if we have the opportunity to open more clinics, we would certainly want to do that. Thank you. One moment for our next question. Our next question comes from Ben Haynor with Lake Street Capital Markets. Your line is open. Good afternoon, gentlemen. Thanks for taking the questions.

David Turkaly: Thank you.

Operator: One moment for our next question. Our next question comes from Ben Haynor with Lake Street Capital Markets. Your line is open.

Fred Hite: Good afternoon, gentlemen. Thanks for taking the questions. First off for me on OPSB and the 25% and 40% realized returns that you're seeing, is that something that includes any sort of halo effects that you see for other products on either the OPS or I guess on the PD and scoliosis side?

David Bailey: First off, for me, on OPSB and the 25% and 40% realized returns that you're seeing, is that something that includes any sort of halo effects that you see for other products on either the OPS or, I guess, on the PUD and scoliosis side? No, it does not. Yeah, it would be difficult, I think, to try to quantify that. So that's not included. Okay. Got it. And then just thinking about the revenue range, the $1 million difference between the top end and the bottom end there, with a $2 million difference between the top end and the bottom end of the EBITDA range, is there anything that folks should read into there? Any additional color on what might drive that EBITDA range to the top or bottom end? No, it's really product mix is probably the single biggest item that drives the change on the bottom line.

David Bailey: No, it does not. We

[Equity Research Associate] (BTIG): Uh.

David Bailey: Uh.

David Bailey: Yeah, it would be difficult, I think, to try to quantify that. That's not included.

[Equity Research Associate] (BTIG): Okay, got it. Then just thinking about the revenue range, the $1 million difference between the top end and the bottom end there, with the $2 million difference between the top end and the bottom end of the EBITDA range. Is there anything that folks should read into there? Any additional color on what might drive that EBITDA range to the top or bottom end?

David Bailey: Okay, got it. Then just thinking about the revenue range, the $1 million difference between the top end and the bottom end there, with the $2 million difference between the top end and the bottom end of the EBITDA range. Is there anything that folks should read into there? Any additional color on what might drive that EBITDA range to the top or bottom end?

David Bailey: No, it's really product mix is probably the single biggest item that drives the change on the bottom line. That's where it was to start with, and we didn't feel like narrowing that gap on the last update.

David Bailey: That's where it was to start with, and we didn't feel like narrowing that gap on the last update. Okay. That's fair enough. Lastly, for me, just on the competitors that are notified customers that are exiting the market, do you have a sense of where their shares stand at, market share stands at, for the likes of them? Yeah, I certainly don't know their market shares in each one of those individual product lines. No question that our largest competitors historically have been legacy products from those two large OEMs. More of their product sales probably are in the commoditized, small plates, small screws types of things like that.

[Equity Research Associate] (BTIG): Okay. That's fair enough. Lastly for me, just on the competitors that have notified customers that they're exiting the market. Do you have a sense of where market share stands at for the likes of them?

David Bailey: Okay. That's fair enough. Lastly for me, just on the competitors that have notified customers that they're exiting the market. Do you have a sense of where market share stands at for the likes of them?

David Bailey: Yeah. I certainly don't know their market shares in each one of those individual product lines. No question that, you know, our largest competitors historically have been legacy products from those two large OEMs. More of their product sales probably are in the commoditized, you know, small plates, small screws, types of things like that. Certainly when there are, you know, less options available in the market and we have, you know, the best products there, it certainly bodes well for us taking all the share we would credibly wanna take in areas like, you know, hip deformity correction, for example.

David Bailey: Certainly, when there are fewer options available in the market and we have the best products there, it certainly bodes well for us taking all the share we would credibly want to take in areas like hip deformity correction, for example. Great. Well, that's fantastic news. That's all I had, gentlemen. Thanks for taking the questions. Thank you. One moment for our next question. Our next question comes from Ryan Zimmerman with BTIG. Your line is open. Hi, everyone. This is Izzy on for Ryan. Thanks for taking the questions. I heard the comments about accelerating off of 12% for the long-term plan with new clinics opening. I was just curious if you guys could talk a little bit about what's giving you the confidence in 12% as being the correct base to grow from. Yeah.

[Equity Research Associate] (BTIG): Great. Well, that's fantastic news. That's all I had, gentlemen. Thanks for taking the questions.

David Bailey: Great. Well, that's fantastic news. That's all I had, gentlemen. Thanks for taking the questions.

David Bailey: Thank you.

[Equity Research Associate] (BTIG): One moment. One moment for our next question. Our next question comes from Ryan Zimmerman with BTIG. Your line is open.

David Bailey: One moment. One moment for our next question. Our next question comes from Ryan Zimmerman with BTIG. Your line is open.

[Equity Research Associate] (BTIG): Hi, everyone. This is Izzy on for Ryan. Thanks for taking the questions. I heard the comments about accelerating off of 12% for the long-term plan with new clinics opening, but I was just curious if you guys could talk a little bit about what's giving you the confidence in 12% as being the correct base to grow from.

David Bailey: Hi, everyone. This is Izzy on for Ryan. Thanks for taking the questions. I heard the comments about accelerating off of 12% for the long-term plan with new clinics opening, but I was just curious if you guys could talk a little bit about what's giving you the confidence in 12% as being the correct base to grow from.

David Bailey: I mean, I guess when we look at implant sales across the board and what we see, you know, adoption rates of all our products, the way the scoliosis business has grown, and then we strip out some of the uncertainty that we've seen from Latin America and strip out, you know, the majority of the 7D, which inevitably is gonna happen. As we've said, it's very difficult for us to determine quarter-to-quarter. When you strip some of those things out and look at the momentum we have in all of those other areas of our business, it gives us a lot of confidence that, you know, a 12% kind of baseline is a good one for us.

David Bailey: I mean, I guess when we look at implant sales across the board and what we see, adoption rates of all our products, the way the scoliosis business has grown, and then we strip out some of the uncertainty that we've seen from Latin America and strip out the majority of the 7D, which inevitably is going to happen. As we've said, it's very difficult for us to determine quarter to quarter. When you strip some of those things out and look at the momentum we have in all of those other areas of our business, it gives us a lot of confidence that a 12% kind of baseline is a good one for us. You're right. I think there's an opportunity for acceleration when you look at the speed with which we're, the rate with which we're growing the OPSB franchise.

David Bailey: You're right, I mean, I think there's the opportunity for acceleration when you look at the speed with which the rate with which we're growing the OPSB franchise. I mean, there's just a lot of demand for clinics. We're seeing same source sales within our existing clinics go up. I don't even think that we have seen the impact yet from the R&D initiatives that we've got going. We've launched a number of products on the OPSB side. I think DF-two is the primary one that we talk about because it's growing so rapidly. I think in the next few quarters, we'll be talking a lot more about a number of new R&D projects that are coming out of the OPSB franchise.

David Bailey: I mean, there's just a lot of demand for clinics. We're seeing same-source sales within our existing clinics go up. I don't even think that we have seen the impact yet from the R&D initiatives that we've got going. We launched a number of products on the OPSB side. I think DF2 is the primary one that we talk about because it's growing so rapidly. I think in the next few quarters, we'll be talking a lot more about a number of new R&D projects that are coming out of the OPSB franchise. When you add all that up, we feel very confident in kind of a baseline growth rate of 12% going forward. Got it. Thank you. I heard you call out strength in other international regions outside of Brazil and Latin America.

David Bailey: I think when you add all that up, we feel very confident in kind of a baseline growth rate of 12% going forward.

[Equity Research Associate] (BTIG): Got it. Thank you. I heard you call out strength in other international regions outside of Brazil and LATAM. I was curious if you guys are taking any steps to kinda de-risk international new volatility as we move into 2026. Are any of the other regions where you're seeing strength, you know, growing fast enough or strong enough to offset any of the headwinds that you've seen this year? Thank you.

David Bailey: Got it. Thank you. I heard you call out strength in other international regions outside of Brazil and LATAM. I was curious if you guys are taking any steps to kinda de-risk international new volatility as we move into 2026. Are any of the other regions where you're seeing strength, you know, growing fast enough or strong enough to offset any of the headwinds that you've seen this year? Thank you.

David Bailey: I was curious if you guys are taking any steps to kind of de-risk international revenue volatility as we move into 2026. Are any of the other regions where you're seeing strength growing fast enough or strong enough to offset any of the headwinds that you've seen this year? Thank you. Yeah. Certainly, as the international business grows, the dependence on revenue from Latin America, South America, particularly Brazil, becomes less impactful. We are seeing really nice growth, particularly in Asia-Pacific as well as EMEA, and particularly, well, really across all of our implant businesses. I'd like to particularly call out the scoliosis growth that we're seeing in both of those areas, which is new. We haven't really had a scoliosis business, particularly in EMEA, over the last few years.

David Bailey: Yeah. It certainly, as the international business grows, the dependence on revenue from Latin America, South America, particularly Brazil, becomes less impactful. We are seeing really nice growth, particularly in Asia Pacific as well as EMEA, and particularly... Well, really across all of our implant businesses. I'd like to particularly call out the scoliosis growth that we're seeing in both of those areas, which is new. We haven't really had a scoliosis business, particularly in EMEA over the last few years. Here in the last 12 months, I've really grown it from, you know, 0 to it's still small, but something nice, and it's growing rapidly. All of that certainly offsets the volatility that we have from stocking distributors in Latin and South America.

David Bailey: Here in the last 12 months, I've really grown it from zero to, it's still small, but something nice, and it's growing rapidly. All of that certainly offsets the volatility that we have from stocking distributors in Latin and South America. I think Fred and I are going to work hard to determine if there are better structures that we could put in place with our stocking distributors in Latin America as well that could potentially mitigate some of the choppiness or lumpiness that we see in revenue. There are a number of things that we can do. Yes, I think you're on a good track here thinking that as we grow these businesses in our agencies, as our agencies become a larger percentage of our revenue, particularly in EMEA, that will mitigate some of this.

David Bailey: I think, you know, Fred and I are gonna work hard to determine if there are better structures that we could put in place with our stocking distributors in Latin America as well, that could potentially mitigate some of the choppiness or lumpiness that we see in revenue. Number of things that we can do, but yes, I think you're on a good track here, thinking that as we grow these businesses in our agencies, as our agencies become a larger percentage of our revenue, particularly in EMEA, that will mitigate some of this. Last thing I would comment on is the progress we're making on the EU MDR.

David Bailey: Last thing I would comment on is the progress we're making on the EU MDR. We have a number of files right now before our notified body, and we do expect by year-end, as we talked about earlier in the year, to have a number of MDR approvals. I'd say the majority or the main one that we are excited about is the approvals for our small-stature scoliosis system, the 4.5 5O system. Right now, we're growing the EMEA scoliosis business rapidly, but really feel like we're doing it with one arm tied behind our back. We don't have half of the product portfolio there. To see customers so readily adopting Response when they really only have access to one embodiment of Response is really encouraging, particularly knowing that we're on the dawn of getting approval for our small-stature system. Thank you. One moment for our next question.

David Bailey: We have a number of files right now before our notified body, and we do expect by year-end, as we talked about earlier in the year, to have a number of MDR approvals. I'd say the majority or the main one that we are excited about is the approvals for our small stature scoliosis system, the 4.5/5.0 system. Right now we're growing the EMEA scoliosis business rapidly, but really feel like we're doing it with one arm tied behind our back. We don't have half of the product portfolio there. To see customers so readily adopting RESPONSE when they really only have access to one embodiment of RESPONSE is really encouraging, particularly knowing that we're on the dawn of getting approval for our small stature system.

Fred Hite: Thank you. One moment for our next question. Our next question comes from Matthew O'Brien with Piper Sandler. Your line is open.

David Bailey: Our next question comes from Matthew O'Brien with Piper Sandler. Your line is open. Hi there. This is Anna on for Matt. Thanks for taking your questions. I just want to ask a bit on the T&D franchise. You've got a bunch of good and new products there, but I guess we were maybe expecting a bit stronger growth. How much room is left in the market, and maybe how much of that is low-hanging fruit versus penetrating the next layer of docs? Yeah. We're really pleased right now with the kind of growth we see, I think, 17% for T&D Global. You could assume that we also see some T&D disruption in LATAM. I think the underlying growth rate of T&D, our largest business, is we feel really good about.

[Analyst] (Piper Sandler): Hi there, this is Anna on for Matt. Thanks for taking our questions. I guess I just wanted to ask a bit on the TND franchise. You've got a bunch of good and new products there, but I guess we were maybe expecting a bit stronger growth. How much room is left in the market and maybe how much of that is low-hanging fruit versus, you know, penetrating the next layer of docs?

David Bailey: Yeah. We're really pleased right now with the kind of growth we see, I think 17% for TND global. You could assume that we also see some TND disruption in LatAm. I think the underlying growth rate of TND, our largest business, is, you know, we feel really good about. There's a lot of growth remaining opportunities, a lot of growth remaining on the TND side. Outside of the United States, as we've talked about, there's a number of EU MDR approvals that are gonna help us continue to grow outside of the US. Then as you've, you know, heard, 3P Small-Mini, 3P Hip, these are product lines that are just now coming out.

David Bailey: There's a lot of growth remaining, opportunities on the 7D, or a lot of growth remaining on the T&D side. Outside of the United States, as we've talked about, there's a number of EU MDR approvals that are going to help us continue to grow outside of the US. As you've heard, 3P Small & Mini, 3P Hip, these are product lines that are just now coming out. Again, we see the exiting of some of our competitors, I suppose, or the incumbent providers of products in that market. I think one of the things that we need to consider or we're considering on the T&D side is just the pace with which we want to grow that business given the volume of sets deployed. You see our set deployment number this year come down from nearly 25 last year to 15 this year.

David Bailey: Again, we see the exiting of some of our, you know, competitors, I suppose, or the incumbent providers of products in that market. I think one of the things that we need to consider or we're considering on the TND side is just the pace with which we wanna grow that business, given the volume of sets deployed. You know, you see our set deployment number this year come down from, you know, nearly 25 last year to 15 this year. You know, a big portion of those sets are on the TND side. Without a direct competitor there, you know, we don't have anybody trying to steal our lunch money, so to speak, in that business. We can flex our growth rate a little bit.

David Bailey: A big portion of those sets are on the T&D side. Without a direct competitor there, we don't have anybody trying to steal our lunch money, so to speak, in that business. We can flex our growth rate a little bit. When we won't want to put as much capital out and driving hard to generate free cash here, we'll deploy fewer sets. That can impact the growth rate negatively if we deploy fewer sets, maybe by a few points, or positively if we, in the future, decide to ramp up set deployment and grow the T&D business a little faster. A lot of low-hanging fruit, I think, still available to us. It's a question more of how we want to either throttle up the growth or throttle back the growth based on the cash usage we want to use in the future. Got it. That's super helpful.

David Bailey: When we won't wanna put as much capital out and driving hard to generate free cash here, we'll deploy, you know, fewer sets, and that can impact the growth rate, you know, negatively if we deploy fewer sets, maybe by a few points, or positively if we, in the future, decide to ramp up set deployment and grow the TND business a little faster. A lot of low-hanging fruit, I think, still available to us. It's a question more of how we want to either throttle up the growth or throttle back the growth based on the cash usage we wanna use in the future.

[Analyst] (Piper Sandler): Got it. That's super helpful. On 7D placements, you know, there tends to be a strong implant pull-through effect in the next few years following placement. I was just wondering how the lower outlook on 7D, how that has any impact on the growth of the core spine business going forward.

David Bailey: On 7D placements, there tends to be a strong implant fall-through effect in the next few years following placement. I was just wondering how the lower outlook on 7D, how that has any impact on the growth of the core spine business going forward. Yeah. That's a great question. I think this is less about our outlook and more about timing. Obviously, the unit placements that we anticipated happening in Q3 certainly haven't gone away. You could assume that they're likely to close at some point in time in the future, whether that's a number of them in Q4 or a bunch in Q1 or vice versa. It's hard for us to determine. I don't think that the delays in the placements of those types of units are something that is significant enough for us to impact the long-term growth rate of the implant business on the scoliosis side.

David Bailey: Yeah, that's a great question. I think this is less about our outlook and more about timing. You know, we obviously, the unit placements that we anticipated happening in Q3 certainly haven't gone away. You could assume that, you know, they're likely to close at some point in time in the future, whether that's a number of them in Q4 or a bunch in Q1 or vice versa. You know, it's hard for us to determine. I don't think that the delays in the placements of those types of units are something that is significant enough for us to impact the long-term growth rate of the implant business on the scoliosis side. Not particularly concerned about that. I think we have more in the top of our funnel on the 7D side than we've ever had.

David Bailey: Not particularly concerned about that. I think we have more in the top of our funnel on the 7D side than we've ever had. I think there's a bright future in terms of set deployments for placements of 7D units. It's just, again, it's hard to determine which quarter it'll happen in. Pretty unlikely to affect implant sales. Okay. Great. That's great to hear. If I can just squeeze in one last one. On the profitability improvements we saw in OPEX, what was cut and how durable? Because you guys did a good job this quarter. Yeah. We're very pleased with the results we saw in the third quarter. Nice improvement, both this third quarter compared to the same time last year, as well as improvement over the second quarter.

David Bailey: I think there's a bright future in terms of set deployments for 7D units. It's just again, it's hard to determine which quarter it'll happen in. Pretty unlikely to affect implant sales.

[Analyst] (Piper Sandler): Okay, great. That's great to hear. If I can just squeeze in one last one. On the profitability improvements we saw in OpEx, what was cut and how durable? Because you guys did a good job this quarter.

Fred Hite: Yeah, we're very pleased with the results we saw in Q3. Nice improvement, both this Q3 compared to the same time last year, as well as improvement over Q2. As mentioned, you know, the restructuring actions we started in Q4 of last year took some more smaller actions earlier this year and then some bigger actions here in Q3. A little bit of those savings showed up in Q3, more of those savings will show up here in Q4 as well as all of 2026. You know, despite the softness in revenue, gross margins are strong, profits are right where we expected them to be, even with higher revenue.

David Bailey: As mentioned, the restructuring actions we started in the fourth quarter of last year took some more smaller actions earlier this year and then some bigger actions here in the third quarter. A little bit of those savings showed up in the third quarter, but more of those savings will show up here in the fourth quarter as well as all of 2026. Despite the softness in revenue, gross margins are strong, profits are right where we expected them to be even with higher revenue. That all means improved free cash flow for the business, which is obviously a key goal as well. Definitely taking steps in the right direction here. Great. Thanks for taking all the questions. Thank you. Thank you. One moment for our next question. Our next question comes from Mike Matson with Needham & Company. Your line is open.

Fred Hite: That all means improved free cash flow for the business, which is obviously a key goal as well. Definitely taking steps in the right direction here.

[Analyst] (Piper Sandler): Great. Thanks for taking all the questions.

David Bailey: Thank you.

Fred Hite: Thank you. One moment for our next question. Our next question comes from Mike Matson with Needham & Company. Your line is open

Joseph Conway: Hey, Dave. Hey, Fred. How you guys doing? This is Joseph on for Mike. I guess maybe just to start off the EU MDR, the approvals or expected approvals you guys called out, does that get you to half or above half of the scoliosis portfolio available over there in Europe? Then, just the reduced staffing that you guys called out, I was just wondering, you know, maybe you did mention it, where that's coming from. Is that, like, demand driven? Is it location dependent? Is this just kind of bloat, you know, I guess, just kind of trimming the fat for staff that necessarily wasn't needed? Thanks.

David Bailey: Hey, David, Fred, how are you guys doing? This is Joseph on for Mike. I guess maybe just start off the EU MDR, the approvals, or expected approvals you guys called out. Does that get you to half or above half of the scoliosis portfolio available over there in Europe? Just the reduced staffing that you guys called out, I was just wondering, maybe you did mention it, where that's coming from. Is that demand-driven? Is it location-dependent? Is this just kind of bloat, I guess, just kind of trimming the fat for staff that necessarily wasn't needed? Thanks. Yeah. From an EU MDR approval standpoint, yes. On our Fusion platform, having the 4, 5, 5O would really give us a full complement on the Fusion side. Certainly, the newer products on the EOS, the early-onset scoliosis products, are not approved in Europe.

David Bailey: Yeah. From an EU MDR approval standpoint, yes, on our Fusion platform, having the 4.5/5.0 would really give us a full complement on the Fusion side. Certainly, the newer products on the EOS, the Early Onset Scoliosis products, are not approved in Europe. That said, there are a number of hospitals and physicians in Europe that operate in locations where they can get those types of products through a critical access type of device or emergency use type of device. We do expect some sales on the EOS side. Yeah, we would have a full complement of product on the RESPONSE side once we get the RESPONSE 4.5/5.0 approved.

David Bailey: That said, there are a number of hospitals and physicians in Europe that operate in locations where they can get those types of products through a critical access type of device or emergency use type of device. We do expect some sales on the EOS side. Yeah, we'd have a pretty—well, we would have a full complement of product on the response side once we get the response 4, 5, 5O approved. I think on the staffing side, a lot of staffing, as we announced last year, we shut down the majority of the facility in Israel, and we're starting to see some savings there. We have historically used our telehealth business both internally for R&D efforts related to EU clinical and regulatory efforts related to EU MDR, as well as had the telehealth business working with a few outside companies.

David Bailey: I think on the staffing side, a lot of staffing, as we announced last year, we shut down the majority of the facility in Israel, and so we're starting to see some savings there. We have historically used our Telos business both internally for R&D efforts related to EU or clinical and regulatory efforts related to EU MDR, as well as had the Telos business working with a few outside companies. I think as we have gotten to a point where EU MDR or at least the technical files have been submitted on the EU MDR side, we can start to throttle back some of those expenses we had with Telos, and so there was headcount associated with that.

David Bailey: I think as we have gotten to a point where EU MDR, or at least the technical files, have been submitted on the EU MDR side, we can start to throttle back some of those expenses we had with telehealth. There was headcount associated with that. I would just say, generally, we're just tightening things up here and recognizing that the business is going to be solidly profitable, and we're going to generate some cash here in the near future and in making some changes around the edges that ultimately will help us drive profitability. Okay. Great. Yeah. That makes a lot of sense. I guess maybe just the next gen, or the new spinal fusion system, is that still expected this year, or is that more of a 2026 launch?

David Bailey: I would just say, generally, we're just tightening things up here and recognizing that, you know, the business is gonna be solidly profitable and we're gonna generate some cash here in the near future, and in making some changes around the edges that ultimately will help us drive profitability.

Joseph Conway: Okay, great. Yeah, that makes a wonderful lot of sense. I guess maybe just the next gen or, you know, the new spinal fusion system, I guess, is that still expected this year or is that more of a 2026 launch? I don't know if it has to do anything with, you know, how much momentum you guys are getting with Response, if that's changing your thinking around the launch there. Yeah, any color there would be helpful.

David Bailey: I don't know if it has to do anything with how much momentum you guys are getting with Response, if that's changing your thinking around the launch there. Yeah, any color there would be helpful. Yeah. Certainly, next gen will be a 2026 initiative. Probably not a full-blown launch in 2026, but our hope is to start doing some cases probably in the back part of 2026. You're fairly accurate in saying that, while from an R&D perspective, we're heads down making sure we got the best system, it's not critically imperative that that product gets launched right away when we see Response growth as high as it is. We're certainly not throttling anything back, but it's good to see that.

David Bailey: Yeah. Certainly, next gen will be a 2026 initiative. Probably not a full-blown launch in 2026, but our hope is to, you know, start doing some cases probably in the back part of 2026. You're fairly accurate in saying that, you know, while from an R&D perspective, we're heads down on making sure we got the best system...

Joseph Conway: Mm-hmm.

David Bailey: It's not critically imperative that that product gets launched right away when we see RESPONSE growth as high as it is. We're certainly not throttling anything back. But it's good to see that, you know, when next gen comes, we think we'll have an absolutely elite system there, and it'll be building on the strength of RESPONSE and an already growing product line in RESPONSE. Probably 2026, to answer your question, back part of 2026. Probably a big launch in 2027, 2028, but not factored into our revenue here this year or really much revenue in 2026.

David Bailey: When next gen comes, we think we'll have an absolutely elite system there, and it'll be building on the strength of Response and an already growing product line in Response. Probably 2026, to answer your question, back part of 2026, probably a big launch in 2027, 2028, but not factored into our revenue here this year or really much revenue in 2026. Okay. Gotcha. Much appreciate your guys' time and taking our questions today. You bet. Thanks. One moment for our next question. Our next question comes from Richard Newbiter with True Security. Your line is open. Hi. Good afternoon. This is Ravian for Rich. I have two questions. Just the first one, on 3P, a number of kind of, I don't know, line extensions or kind of new innovation and how to characterize that new innovation in this space.

Joseph Conway: Okay. Gotcha. Much appreciated your guys' time and taking our questions today.

David Bailey: You bet. Thanks.

Operator: One moment before our next question. Our next question comes from Richard Newitter with Truist Securities. Your line is open.

[Analyst] (Truist Securities): Hi. Good afternoon. This is Ravi in for Rich. I have two questions. Just the first one, on 3P, a number of kind of, I don't know, line extensions or kind of new innovation, how to characterize the new innovation in this space. Just around that, can you help us understand, you know, how that gets you into I believe you talked about a $450 million or so TAM in that opportunity. Like, how does that allow you to penetrate that? Presumably, should we be thinking of this longer term as kind of a leverage driver, both SG&A as well as growth margins, given that you have kind of a unified platform of products for production and kind of sale of hallux?

David Bailey: Just around that, can you help us understand how that gets you into, I believe you talked about a $450 million or so TAM in that opportunity. How does that allow you to penetrate that? Presumably, should we be thinking of this longer term as kind of a leverage driver, both SG&A as well as gross margins, given that you have kind of a unified platform of products for production and kind of sale of polyps? Makes sense. Yeah. As we've mentioned, the 3P, there is a number of different implant systems in the 3P that will be more targeted to anatomic areas or specific deformity correction opportunities. I would say that we're opening a lot of new opportunities with 3P because our existing plating system doesn't have all of the indications covered. I would say it's a little bit antiquated.

David Bailey: Yeah. As we've mentioned, the 3P, there is a number of different implant systems in the 3P that'll be more targeted to anatomic areas or specific deformity correction opportunities. I would say that we're opening a lot of new opportunities with 3P because of our existing plating system doesn't have all of the indications covered, and I would say is a little bit antiquated. I think 3P being kind of the flagship for our trauma and limb deformity product portfolio on a go-forward basis has a big impact on our capacity to grow the T&D business. I think that it probably gets us deeper, Ravi, into existing accounts, as you know, we're present in every major children's hospital.

David Bailey: I think 3P being kind of the flagship for our trauma and limb deformity product portfolio on a go-forward basis has a big impact on our capacity to grow the T&D business. I think that it probably gets us deeper, Ravi, into existing accounts. As you know, we're present in every major children's hospital. What we struggle sometimes with is that when there are shelf space and shelf presence for things that are more commoditized and small plates and screws that have been there for a long time, it's going to take some more disruptive technology to get those systems off the shelf and get newer, more modern systems in.

David Bailey: I think what we struggle sometimes with is that when there are shelf space and shelf presence for things that are more commoditized and small plates and screws that have been there for a long time, it's gonna take some more disruptive technology to get those systems off the shelf and get newer, more modern systems in. I do think that as we do the full launch of 3P over the next few years, you're gonna see the opportunity for substantial displacement of more of the commoditized product and replace that with some pretty high technology products that also have very specific plates and screws, shapes and sizes, instruments that ultimately allow surgeons to do the procedures easier.

David Bailey: I do think that as we do the full launch of 3P over the next few years, you're going to see the opportunity for substantial displacement of more of the commoditized product and replace that with some pretty high-technology products that also have very specific plates and screws, shapes, and sizes, instruments that ultimately allow surgeons to do the procedures easier. It's a big deal for us. I do think it allows us to get deeper and deeper in the children's hospitals where we're already present. Yeah. Just to the leverage question, that's a great call out. I mean, it's called a platform for a reason.

David Bailey: It's a big deal for us, and I do think it allows us to get deeper and deeper in the children's hospitals where we're already present.

Fred Hite: Yeah. Just to the leverage question, that's a great call-out. I mean, it's called a platform for a reason. That's the design from the very beginning, is to try to leverage this stuff and to really drive what we've been working on for the last really 3 to 5 years with all of our new product introductions, which is improved return on all of our assets that we're deploying. By combining this into a platform, we can then leverage similar drivers, similar screws, a lot of the similar items across multiple platforms, which gives us tremendous improved return on investment on these new sets coming out. More leverage there, leverage with the suppliers than really on the SG&A side. You'll probably see it show up more in improved gross margin.

David Bailey: That's the design from the very beginning, to try to leverage this stuff and to really drive what we've been working on for the last really three to five years with all of our new product introductions, which is improved return on all of our assets that we're deploying. By combining this into a platform, we can then leverage similar drivers, similar screws, a lot of the similar items across multiple platforms, which gives us tremendous improved return on investment on these new sets coming out. More leverage there, leverage with the suppliers, than really on the SG&A side. You'll probably see it show up more in improved gross margin. Absolutely, improved gross margin and better return on investment from a cash perspective is absolutely multiple benefits from that type of a system launch. Yeah. Sorry to amplify Fred's point on the asset utilization metrics here.

Fred Hite: Absolutely, improved gross margin and better return on investment from a cash perspective is absolutely, multiple benefits from that type of a system launch.

David Bailey: Yeah, just sorry. To amplify Fred's point on the asset utilization metrics here. I mean, we've talked to the investment community for a long time about how our legacy products probably, you know, where some of those products that are in the market still growing, but they've been out there for, you know, 10 and 15 years. When we developed those products 15, nearly 20 years ago, asset utilization metrics were not, you know, top of our list when we were a tiny company, you know, 20 years ago or 18 years ago.

David Bailey: I mean, we've talked to the investment community for a long time about how our legacy products probably were some of those products that are in the market still growing, but they've been out there for 10 and 15 years. When we developed those products 15, nearly 20 years ago, asset utilization metrics were not top of our list when we were a tiny company 20 years ago or 18 years ago. And since. The IPO and really over the last five years, I mean, new product development has not only focused on meeting major unmet clinical needs in pediatric healthcare, but also being able to do that where we're getting better asset utilization metrics, so either high ASP against, or less inventory.

David Bailey: Since, you know, the IPO and really over the last 5 years, I mean, new product development has not only focused on meeting major unmet clinical needs in pediatric healthcare, but also being able to do that where we're getting better asset utilization metrics, so either high ASP against or less inventory. I can say with confidence after seeing, you know, what we're getting on 3P Hip and what we're getting both from an ASC standpoint as well as just the inventory required to do those elective procedures, that the 3P first iteration of the 3P Platform is doing exactly as we want. It's allowing surgeons to do procedures on kids they would really struggle otherwise and really high demand types of patients.

David Bailey: I can say with confidence after seeing what we're getting on 3P Hip and what we're getting both from an ASP standpoint as well as just the inventory required to do those elective procedures, that the first iteration of the 3P platform is doing exactly as we want. It's allowing surgeons to do procedures on kids they would really struggle otherwise and really high demand types of patients. It's also doing it at a really nice price point for us, a really nice margin for us. I'm pretty excited to see the return on assets meeting our needs, meaning a substantial improvement over some of our legacy products. Great. Thanks for the super descriptive response. Maybe one last one. No, I mean, it's an important product driver, right?

David Bailey: It's also doing it at a really nice price point for us, a really nice margin for us. I'm pretty excited to see the return on assets meeting our needs, meeting a substantial improvement over some of our legacy products.

[Analyst] (Truist Securities): Great. Thanks for the super descriptive response. Then just maybe one last one. No, I mean, it's an important product driver, right? Just kind of a question on the Q&A kind of just struck me around how you're thinking about Latin American growth right now and kind of Brazil as you kind of work your way through the dynamics there. You know, when you're looking at kind of the long-term 12% outlook that you're putting out there for 2026, 2027 beyond, how should we, you know, kinda think about if you're looking to restart growth, obviously in that area of the world, with a new business model potentially coming in, should we think about, you know, maybe trading some profitability for revenue there?

David Bailey: Just on the last, just kind of a question on the Q&A kind of just struck me around how you're thinking about Latin American growth right now and kind of Brazil as you kind of work your way through the dynamics there. When you're looking at kind of the long-term 12% outlook that you're putting out there for 2026, 2027, beyond, how should we kind of think about, if you're looking to restart growth, obviously, in that area of the world, with a new business model potentially coming in, should we think about maybe trading some profitability for revenue there or any kind of comments that you can kind of give us as you work through your new strategy there, given the changes you've seen in the last couple of months would be very helpful into 2026? Thanks. Yeah.

[Analyst] (Truist Securities): Any kind of comments that you can kinda give us as you work through your new strategy there, given the changes you've seen in the last couple of months would be very helpful into 26. Thanks.

Fred Hite: Yeah. What I would say is, I think you should expect more of the same in that revenue is important, but improving profitability and improving free cash flow is as important. It's not revenue at all costs. It's revenue that's profitable, and it's revenue that generates free cash flow for us. Any change that we do, I think in the business, you could assume is going to follow those same principles. It's not necessarily going to maximize revenue growth, but more importantly, improve the profitability of sales down there, as well as dramatically improve the cash flow of that operation.

David Bailey: What I would say is I think you should expect more of the same in that revenue is important, but improving profitability and improving free cash flow is as important. It's not revenue at all cost. It's revenue that's profitable, and it's revenue that generates free cash flow for us. Any change that we do, I think, in the business, you could assume is going to follow those same principles. It's not necessarily going to maximize revenue growth, but more importantly, improve the profitability of sales down there as well as dramatically improve the cash flow of that operation. Thank you. I'm not showing any further questions at this time. I'd like to turn the call back over to Dave for any further remarks. Well, thank you for everybody for your good questions. Thank you for your time.

Operator: Thank you. I'm not showing any further questions at this time. I'd like to turn the call back over to Dave for any further remarks.

David Bailey: Well, thank you for everybody for your good questions. Thank you for your time. I'd just like to thank all my associates and partners in pediatric healthcare and our investors for continuing to share in the mission to help a million kids a year. Have a great day, and we'll look forward to talking to you soon.

David Bailey: I'd just like to thank all of my associates and partners in pediatric healthcare, and our investors, for continuing to share in the mission to help a million kids a year. Have a great day, and we'll look forward to talking to you soon. Well, ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

Operator: Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

Today's call as a reminder, this call is being recorded for replay purposes I would now like turn the conference over to trip Taylor from the Gilmartin group for a few introductory comments.

Thank you for joining today's call with me from the company are David Bailey, President and Chief Executive Officer, and Fred Hite, Chief operating and financial Officer before we begin today, let me remind you that the Companys remarks include forward looking statements within the meaning of federal securities laws, including the Safe Harbor provisions.

The private Securities Litigation Reform Act of $19 95. These forward looking statements are subject to numerous risks and uncertainties and the company's actual results may differ materially for a discussion of risk factors I encourage you to review the company's most recent annual report on Form 10-K, which was filed with the SEC.

SEC on March five 2025, and its subsequent quarterly reports on Form 10-Q during.

During the call today management will also discuss certain non-GAAP financial measures, which are supplemental measures of performance. The company believes these measures provide useful information for investors in evaluating its operations period over period.

For each non-GAAP financial measure referenced on this call. The company has included a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure in the third quarter earnings release.

Please note that the non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitute for ortho pediatrics financial results prepared in accordance with GAAP.

In addition, the content of this conference call contains time sensitive information that is accurate only as of the date of this live broadcast today October 28 2025.

Except as required by law the company undertakes no obligation to revise or update any statements to reflect events or circumstances, taking place. After the date of this call.

With that I would like to turn the call over to David Bailey, President and Chief Executive Officer.

Thanks, Chris Good afternoon, everyone and thank you for joining US today, we're proud to start this call with our typical and most meaningful performance metrics in the third quarter, we supported the treatment of more than 37100 children.

Increasing our total impact to approximately $1 3 million kids help.

With too few solutions designed specifically for children and the clinicians who care for them pediatric health care has long face critical gaps at LP. We are committed to addressing these unmet needs and our mission to close those gaps and reshape the future of pediatric care remains clearer than ever we have made tremendous progress in this market but.

There is still a substantial market opportunity ahead.

In the third quarter, we saw strength in all areas of our business, excluding 70 capital sales in Latam International stocking and set sales.

In fact, we saw total third quarter global revenue growth, excluding 70 capital sales of 17%.

Domestic revenue growth, excluding 70 capital sales of 19%.

T&D and scoliosis implant sales were strong as we saw a very normal summer selling season, and OSB growth continues to be extremely robust with growth in excess of 20%.

As a reminder, OSB sales are approximately 80% T&D and 20% scoliosis and we saw strong growth in both areas.

As we highlighted in our preliminary announcement, our revenue results fell short of our expectations driven by two isolated factors 70 capital sales that were expected in the quarter did not closed prior to the quarter end and.

And headwinds from stocking and set sales in Latin and South America have continued longer than expected.

Although these two areas did not produce the results. We wanted these are two of our lower margin segment and because of the rest of the business remains strong we still delivered high gross margins and profitability in line with our expectations.

Looking beyond the top line for the third quarter. We are pleased to see a significant 56% improvement in adjusted EBITDA growing to $6 2 million.

In addition, we also saw huge progress with our free cash flow usage, which was dramatically lower than the third quarter decreasing $8 2 million. Both of these metrics have been a focal point of our strategy and we are succeeding in delivering our goals.

Touching briefly on our outlook as.

As announced previously for the full year, we now expect revenue to range from $233 5 million to $234 $5 million.

Adjusted EBITDA is still expected to be $15 million to $17 million and we are on track to deploy $15 million in sets and generate positive free cash flow in Q4.

Even though our top line expectations have been adjusted we are maintaining our profitability and free cash flow outlook.

As we drive toward our profitability goals are core business, consisting of trauma and deformity and scoliosis implants.

Specialty pricing and our international agencies generates higher margins and better free cash flow than the capital sales and Latam stocking and set sales are.

Our core businesses are positioned to remain the key engines of revenue growth adjusted EBITDA and free cash flow and we are confident in our forecast is generating positive free cash flow in Q4 and breakeven in 2026.

Turning to our segments in the third quarter of 2025, the T&D business grew by 17% in the quarter driven by continued strong market share gains across several product lines more specifically growth was led by strong performances in trauma implants.

And a return to normal scheduling and the elective limb deformity business.

Extremely strong <unk> growth and the continued high growth of <unk> or the highlights in the quarter.

Taking a closer look at trauma, we saw particularly strong revenue gains driven by continued rapid adoption of <unk> <unk> <unk> and the <unk> activist group.

Looking closer at the three P platform following the FDA approval of the <unk> pediatric playing platform hip system and its first surgical basis, we are seeing consistent case growth, which we expect to continue through the remainder of the year and to ramp aggressively as we begin the full launch of this product in 2026.

Additionally, we are pleased to have recently accomplished another milestone for this platform as we have just announced the next <unk> system in the series <unk> small and many has been approved by the FDA.

This approval comes ahead of schedule and we now expect to complete the first cases in the beginning of next year with a <unk> platform, we expect to launch new systems each year for the next several years bolstering bolt trauma and limb deformity revenue.

T&D remains a core growth engine for our business powered by our expanding scale ongoing market share gains and a steady cadence of innovation focused on unmet clinical needs. We have established ourselves as a market leader in T&D and we are executing with confidence, especially as we see more competitors exiting the space by removing <unk>.

<unk> specific product lines.

Our <unk> specialty bracing strategy continues to build momentum and with continued execution of our operational goals our confidence in this long term opportunity only strengthened.

This segment represents a high potential capital efficient growth Avenue and is an integral part of our company strategy.

We will continue our efforts to drive targeted territory expansion accelerate R&D efforts and continue scaling our sales force.

As a reminder, when we acquired Boston LNP in January of 2024, there were 26 operational clinics.

As previously reported since then we've expanded to more than 40 clinics entered into eight new territories and launched several new products, our preliminary expectations for new clinic return on investments, 25% for new clinic acquisitions, and 40% for new Greenfield clinics are being realized.

During the quarter, we expanded our footprint into two very large markets, New York City, and California, We expanded Denver done in Ohio and for the first time, we expanded internationally with a clinic in Ireland.

These latest additions continue to reinforce the importance and need for <unk> clients and we anticipate that the strong wave of clinic expansion opportunities driven by high customer demand and a robust pipeline will continue in.

In addition to expansion opportunities same store sales growth has been increasing and generating positive momentum.

Our <unk> strategy is delivering strong results and has proven to be a highly efficient expansion path forward for pediatrics, our presence outside the operating room allows us to create deeper partnerships with our customers.

This powerful strategy is extending our leadership position in pediatric orthopedics, we remain focused on executing our strategy with precision as we work towards securing a leading share in this growing market.

Moving to the scoliosis business, our growth of 4% seen in scoliosis. This quarter was led by strong U S scoliosis implant and scoliosis or PSP growth offset by $2 $3 million lower 70 capital sales.

Scoliosis growth continues to be led by new users adopting ortho pediatrics technology, including response.

As well as pull through from past 70 placements.

As mentioned the underlying <unk> business grew nicely, but was negatively affected by reduced stocking and set sales in Latam primarily Brazil.

We expect this will continue for the next several quarters, but are working on an improvement plan to implement in the near future.

<unk> sales in the quarter were impacted by increased variability in the timing of unit placements that caused delayed capital sales.

And the corresponding revenue from those placements had a significant impact on quarterly sales and overall growth.

Typically there are a few 70 unit sales within the quarter, but for the third quarter 2025, there were zero unit sales. This compares to our strongest 70 unit sales results in the third quarter of 2024.

We still expect 70 to be a revenue driver for us, but we cannot predict how much and which quarter sales will fallen.

To minimize the impact of lumpy 70 unit sales, we have adjusted our outlook. So there was minimal impact on our expectations, which does result in negative growth assumptions from this segment.

Looking at our Eos product portfolio, we are pleased to see that our portfolio expansion strategy continues to be affected in particular, we are seeing positive trends with our recently launched vertical I'd spinal growth system for skeletal immature patients.

Following the first completed cases in August we are seeing solid adoption of vertical line through the limited release and we remain on target for the full market release in the coming months. We are excited about the progress made within this portfolio and look forward to progressing the remainder of our pass products.

Moving to international International underlying sales were solid in the quarter due to extremely strong demand in surgical volume in EMEA and APAC offset by unfavorable growth from Latam.

The underlying revenue largely comes through our sales agencies and represents a good reflection of high surgeon usage and higher margin replenishment revenue, we are particularly excited to see our EMEA scoliosis launch going so well and are eagerly awaiting the EU MD, our approval of our $4 five scoliosis system along with multiple other.

<unk> expected for the end of the year.

On the other hand, the headwinds in Latam have persisted longer than we anticipated in an effort to focus on improved cash metrics. We have made the conscious decision to limit new stocking and set sales to South America. This dynamic continues to play out and negatively impacts our growth, particularly in Brazil.

We believed that at this point, our Latam business would be in a more stable position and that we would see the benefit of growth in Latin and South America. Again. However, we experienced continued disruption in sales largely related to timing of large stocking and set orders.

We are working towards solutions, but expect there to be some variability here moving forward, which we have reflected in our outlook.

In summary, we are proud of the way the business performed excluding 70 million Latam Ortho pediatrics continues to lead the pediatric orthopedic market and provide comprehensive solutions to support the care of children, we remain focused on execution across the business, including scaling of opiate B <unk>.

Leveraging previous set deployment and launching innovative new products. This strategy will support revenue growth increased adjusted EBITDA, while meaningfully reducing cash burn as we work towards achieving free cash flow breakeven in 2026 Lastly, we believe our strategy positions ortho pediatrics to help more children than ever before.

With that I'd like to turn the call over to Fred to provide more details on our financial results Fred.

Thanks, Dave.

Taking a closer look at the P&L, our third quarter of 2025 worldwide revenue of $61 $2 million increased 12% compared to the third quarter of 2024.

Growth in the quarter was driven primarily by strong performance across trauma, and deformity, and scoliosis and <unk> offset by a decline in 70 unit sales and Latam stocking and set sales.

U S revenue was $48 7, million% to 14% increase from the third quarter of 2024.

Representing 80% of total revenue.

Growth in the quarter was primarily driven by trauma, and deformity, and scoliosis and <unk> offset by a decline in 70 unit sales.

We generated total international revenue of $12 5 million representing growth of 6% compared to the third quarter of 2024, and representing 20% of our total revenue.

Growth in the quarter was primarily led by increased procedure volumes.

Partially offset by lower stocking and set sales to Latam.

In the third quarter of 2025 trauma and deformity global revenue of $44 $1 million increased 17% compared to the prior year period.

Growth was primarily driven by strong growth across multiple product lines, specifically, our calculated screws Pnp femur, Pnp tibia <unk> two and <unk>.

In the third quarter of 2025, Scoliosis global revenue of $16 $3 million increased 4% compared to the prior year period.

Growth was primarily driven by increased sales of response by $5 six so and revenue generated from Firefly.

Offset by a decline in 70 unit sales.

Finally sports medicine other revenue in the third quarter of 2025 was <unk> $9 million.

Compared to $1 $3 million in the prior year period.

Touching briefly on a few key metrics for the third quarter of 2025 gross profit margin was 74% compared to 73% for the third quarter of 2024.

The increase in gross margin was primarily driven by favorable product sales mix.

As a result of lower 70 unit sales and lower stocking and set sales to last Sam which generate lower gross margin profit.

Total operating expenses increased 9.0 or $1 million or 19% compared to the prior year period to $54 $7 million in the third quarter of 2025.

The increase was mainly driven by $2 3 million of restructuring charges to.

$2 3 million of impairment charges increased.

Increased noncash stock compensation as well as the ongoing growth of the <unk> clinics.

Sales and marketing expenses increased $1 9 million or 11% compared to the prior year period to $18 7 million in the third quarter of 2025.

The increase was mainly driven by increased sales commission expense and an overall increase in volume of units sold.

General and administrative expenses increased $2 9 million or 11% year over year to $29 $2 million in the third quarter of 2025.

The third quarter increase was driven primarily by increased noncash stock compensation as well as the ongoing growth of the <unk> clinics.

And tangible asset impairment recorded during the third quarter of 2025 was $2 $3 million related to our annual impairment test, where we determined the fair value of <unk> tell us and med tech trademark assets.

And <unk> customer relationship assets were below the carrying value.

We recorded an impairment charge to reduce the carrying amount of the intangible assets to their estimated fair value.

Restructuring charges recorded during the third quarter of 2025 was $2 $3 million.

The company's global restructuring plan started in the fourth quarter of 2024 aimed at improving operational efficiency.

Reducing operating costs as well as reducing staffing.

For the third quarter, we recorded additional restructuring expense as we continue to view structural changes required to drive down cost.

We saw savings in the third quarter, but anticipate greater impact in the fourth quarter and in 2026.

Research and development expense decreased <unk> $2 million in the third quarter of 2025 due to timing of product development third party invoices.

Total other expense was $2 5 million for the third quarter of 2025 compared to $3 $6 million of other expense for the same period last year.

GAAP net loss per share for the period was $0 50.

Per basic and diluted share compared to <unk> 34.

Per basic and diluted share for the same period last year.

non-GAAP net loss per share for the period was zero point 24 cents per basic and diluted share compared to zero or <unk> 18 per.

Per basic and diluted share for the same period last year.

Adjusted EBITDA was $6 2 million in the third quarter of 2025% to 56% improvement when compared to $4 zero or $1 million in the third quarter of 2024.

We ended the third quarter with $59 8 million in cash and short term investments and restricted cash in.

In the third quarter, we saw a significant improvement in free cash flow performance.

For the third quarter free cash flow usage was $3 4 million compared.

Compared to $11 $7 million of free cash flow usage for the third quarter of 2024.

Set deployment was $4 1 million in the third quarter of 2025 compared to $5 3 million in the third quarter of 2024.

Turning to guidance.

As Dave mentioned, we adjusted our expectation for full year 2025 revenue to be in the range of 233 five.

To $234 $5 million, representing year over year growth of 14% to 15%.

We are reiterating the guidance that our full year gross margin will be within the range of 72% to 73%.

We also continue to expect to generate between $15 million to $17 million of adjusted EBITDA in 2025 <unk>.

Additionally, we continue to expect approximately $15 million of new set deployed in 2025. This represents our continued focus on driving the business to free cash flow breakeven by 2026, and we anticipate delivering our first quarter of free cash flow positivity in the <unk>.

Fourth quarter of 2025.

Operator, let's open the call for Q&A.

Thank you ladies and gentlemen, if you have a question or comment at this time. Please press star one on your telephone.

This has been answered or you wish to move yourself from the queue. Please press star one again, we will pause for a moment, while we compile our Q&A roster.

Our first question comes from David <unk> with citizens Bank. Your line is open.

Hey, good evening.

Have you made a comment I thought I heard you make it so I just wanted to clarify it.

Something about competitors exiting the space I was wondering specifically what were you referring to there.

Yes, good question Dave.

Listen we see some of the big Oems that are of notified customers that theyre pulling products.

<unk> historically have been used in the pediatric patient population. So we've seen that from J&J, we've seen that from Smith <unk> nephew in the last six months more recently.

J&J with with a hit product that would be a competitor to <unk>.

We have really nice timing that we're coming out with a new <unk> system and.

And just I think seeing a continued defocus of these.

Pediatrics and some of the large Oems, which I think is not necessarily a great overall for patients, but certainly good for us from a competitive standpoint.

And I know that you've talked about sort of 12%.

I think the new FRP limit our downside.

The lower limit of growth.

And it seems like you're doing a pretty good job with these clinics per day.

As we look ahead to the next couple of years do you think there is an ability to possibly accelerate either.

Expenses of the openings on the <unk> side, maybe to accelerate that number. Thank you.

Yes, I think there is no question that there is extremely high demand for clinics.

<unk>.

This year I would say, we've gotten a lot of experience in terms of the timing of accelerating those clinics at a timing of getting those clinic started we're pleased with what we've seen so far and you can bet that if we have the opportunity to do more and do more faster. We would certainly want to do that certainly trying to balance also that against the P&L requirements are.

We're trying to drive to increase profitability, but I think the demand is there and yes, you could assume that if we have the opportunity to open more clinics, we would certainly want to do that.

Thank you.

One moment for our next question.

Our next question comes from Ben Andrew with Lake Street Capital Markets. Your line is open.

Good afternoon, gentlemen, thanks for taking the questions.

First off for me on <unk>, and the 25% and 40% realized returns that youre seeing is that something that includes any sort of halo.

Thanks.

You see for other other products on.

On either <unk> or I guess on the scoliosis side.

No it does not.

Yes, it would be difficult.

Try to quantify that so that's not included.

Okay got it and then just thinking about the revenue range the $1 million difference between the top end and the bottom and there was a $2 million.

The difference between the top end and the bottom end of the EBITDA range is there anything that folks should read into there.

Any additional color on what might drive that.

EBITDA range to the top or bottom end.

No it's really product mix is probably the single.

Biggest item that drives the change on the bottom line, that's where it was to start with and we didn't feel like.

Narrowing that gap on the last update.

Okay. That's fair enough and then lastly for me just on the competitors that have notified customers that are exiting the market do you have a sense of where their shares stand that market share stands at.

For the likes of them.

Yes.

Certainly don't know their market shares in each one of those individual product lines.

No question that our largest competitors historically have been legacy products from those two large Oems.

And more of their <unk>.

Product sales probably are in the Commoditized small polite small screws types of things like that but certainly when they're less options available in the market and we have the best products, there certainly bodes well for us taking all the share we would do.

Who are incredibly want to take in areas like hip deformity correction for example.

Great.

So that's fantastic news, that's all I had gentlemen, thanks for taking the questions.

Thank you good morning.

One moment for our next question.

Our next question comes from Ryan Zimmerman with <unk>. Your line is open.

Hi, everyone. This is Eddie on for Ryan Thanks for taking the questions.

I heard the comments about accelerating office, 12% for the long term plan with new clinics opening but I was just curious if you guys could.

Ed.

Talk a little bit about what's giving you the confidence in 12% as being the correct base to grow from.

Yes, I mean, I guess, when we look at implant sales across the board and what we see.

Adoption rates of all of our products the way the scoliosis business has grown and then we strip out some of the uncertainty that we've seen from Latin America and strip out the majority of the 70, which inevitably is going to happen, but as we said it was very difficult for us to determine quarter to quarter and restrict some of those things out and look at the <unk>.

<unk>, we have in all of those other areas of our business and gives us a lot of confidence that 12% on a baseline is.

A good one for US and you are right I mean, I think there is any opportunity for acceleration when you look at the speed with which were the rate with which we are growing the <unk> franchise.

I mean, there's just a lot of demand for clinics or seeing same store sales within our existing clients go up.

And I don't even think that we have seen the impact yet from from the R&D initiatives that we've got going we've launched a number of products on the <unk> side I think <unk> is the primary one that we talk about because it's growing so rapidly, but I think in the next few quarters.

We'll be talking a lot more about a number of new R&D projects that are coming out of the <unk> franchise and I think when you add all that up we feel very confident in kind of a baseline growth rate of 12% going forward.

Got it thank you and I heard you call out strength in other international regions outside of Brazil, and Latam I was curious if you guys are taking any steps taken to de risk internationally rabbit, new volatility as we move into 2026.

Are any of the other regions, where you're seeing strength.

<unk> fast enough very strong enough to offset any of the headwinds that you've seen this year.

Yes.

Yes, it certainly as the international business grows the dependence on revenue from Latam Latin America, South America, particularly Brazil becomes less impactful.

And we are seeing really nice growth, particularly in Asia Pac as well as EMEA and.

And particularly well really across all of our implant businesses I'd like to particularly call out the scoliosis growth that we're seeing in both of those areas, which is new we haven't really had a scoliosis business, particularly in EMEA over the last few years and here in the last 12 months of really grown from zero to it's still small but.

But that's something nice and it's growing rapidly and so all of that certainly offsets the volatility that we have from stocking distributors in Latin and South America and I think.

Fred and I are going to work hard to determine if there are better structures that we could put in place with our stocking distributors in Latin America, as well that could potentially mitigate some of the choppiness or lumpiness that we see in revenue and.

Number of things that we can do but yes, I think youre on a good track here thinking that as we grow these businesses and our agencies as our agencies become a larger percentage of our revenue, particularly in EMEA.

That will mitigate some of this last thing I would comment on is the progress we're making on the EU MBR.

We have a number of files right now before.

Our notified body and we do expect by year end as we talked about earlier in the year to have a number of NDA approvals.

Say the majority or the main one that we are excited about is the.

The approvals for our small stature scoliosis system, the 40 550 system.

Right now we're growing the EMEA scoliosis business rapidly, but really feel like we're doing it with one arm tied behind our back we don't have half of the product portfolio, there and so to see customers. So readily adopted in response when they really only have access to one embodiment of response is really encouraging, particularly knowing that were on the door.

<unk> of getting approval for for our small stature system.

Thank you one moment for our next question.

Our next question comes from Matthew O'brien with Piper Sandler Your line is open.

Hi, there this is Anna on for Matt Thanks for taking our questions.

I guess I just wanted to ask a bit on the T&D franchise, you've got a bunch of good new products there but.

I guess, we were maybe expecting get stronger growth. So how much room is left in the market and maybe how much of that is low hanging fruit versus penetrating the next layer of docs.

Yes. So we're really pleased right now with the kind of growth, we see I think 17% for T&D global and you could assume that we also see some T&D disruption in Latam. So I think the underlying growth rate of T&D, our largest business.

We feel really good about.

There's a lot of growth remaining opportunities on the 70 <unk>.

Lot of growth remaining on the T&D side.

Outside of the United States as we've talked about there's a number of <unk> approvals that are going to help us continue to grow outside of the U S. And then as you.

Heard <unk> small <unk> hit these are product lines that are just now coming out and again, we see the exiting of some of our.

Competitors I suppose of the incumbent providers of products in that market. So.

I think one of the things that we need to consider when you're considering on the T&D side is just the pace with which we want to grow that business given the volume of sets deployed you see are set deployment number this year come down from nearly 25 last year to 15 this year.

Big portion of those sets are on the T&D side, and so without a direct competitor there.

We don't have anybody.

Trying to steal our lunch money so to speak in that business and we can flex our growth rate a little bit and when we don't want to put as much capital out and driving hard to generate free cash here.

We will deploy fewer sets and that can impact the growth rate.

Negatively if we deploy fewer SaaS, maybe by a few points or positively if we in the future decide to ramp up set deployment and grow the T&D business, a little faster. So a lot of low hanging fruit I think still available to us.

A question more of how we want to either throttle up the growth are all back to growth based on the cash usage, we want to use in the future.

Got it that's super helpful and then on <unk> placements.

To be a strong implant pull through effect in the next few years. Following placement. So I was just wondering how the lowered outlook on 70, how that has any impact.

The growth in the core spine business going forward.

Yes, that's a great question I think this is less about our outlook and more about timing.

We obviously the units unit placements that we anticipated happening in Q3, certainly haven't gone away you can assume that they are likely to close at some point in time in the future whether thats a number of them in Q4 or a bunch in Q1 or vice versa.

For us to determine but I don't think the delays in the placements of those types of units or something that is significant enough for us to impact the long term growth rate of the implant business on the scoliosis side.

So not particularly concerned about that I think we have we.

We have more in the top of our funnel on the <unk> side than we've ever had.

And.

So I think there is a bright future in terms of set deployments for <unk>.

Placements of 70 units.

It's just again, it's hard to determine which quarter, though all happening pretty unlikely to affect implant sales.

Okay, Great that's great to hear and then if I can just squeezing one last one.

On the profitability improvements we sign Opex.

Cotton, how durable because you guys did a good job this quarter.

Yes, we're very pleased with the results we saw in the third quarter nice improvement.

Both this third quarter compared to the same time last year as well as improvement over the second quarter.

As mentioned the <unk>.

Restructuring actions, we started in the fourth quarter of last year took some more smaller actions earlier this year and then some bigger actions here in the third quarter.

A little bit of those savings showed up in the third quarter, but more of those savings will show up here in the fourth quarter as well as all of 2026.

So.

Despite the softness in revenue.

Gross margins are strong profits are right, where we expected them to be even with higher revenue and that all means improved free cash flow for the business, which is obviously a key goal as well so definitely taken steps in the right direction here.

Great. Thanks for taking all the questions.

Thank you. Thank you.

For our next question.

Our next question comes from Mike Matson with Needham <unk> Company. Your line is open.

Hey, David how are you going to do and this is Joseph on for Mike.

<unk>.

So I guess, maybe just started off the U N D or the approvals.

Approvals you guys called out does that get you to half or above half of the.

Scoliosis portfolio available over there in Europe.

And then.

Just to reduce staffing levels that you guys called out I was just wondering maybe you did mentioned where that's coming from is that is that demand driven is it the location dependent and this is kind of blue.

Just kind of trimming the fat.

For staff and necessarily wasn't needed.

Yes, so from an <unk> approval standpoint, yes on our fusion platform having.

Having the four or five fibre would really give us a full complement on the fusion side certainly the newer products on the Eos. The early onset scoliosis products are not approved in Europe.

That said there are a number of hospitals and physicians in Europe that operate in locations where.

They can get those types of products through a critical access.

Type of device.

Our emergency use type of device. So we do expect some sales.

<unk>.

POS side, but yes, we would have a pretty comp or what we would have a full complement of product on the response side. Once we get the response $4 five per I think on the staffing side.

A lot of staffing.

As we announced last year, we shut down the majority of the facility in Israel and so we're starting to see some savings there.

Have historically used our <unk> business, both internally for our R&D efforts related to <unk>.

Clinical and regulatory efforts related to <unk> as well as had the <unk> business working with a few outside companies I think as we have gotten to a point, where <unk> or at least the.

The technical files have been submitted on the <unk> side, we can start to throttle back some of those expenses, we had with tell off and so there was head count.

Associated with that and I would just say generally we're just tightening things up here and recognizing that the business is going to be solidly profitable and we're going to generate some cash here in the near future and in making some some some changes around the edges that ultimately will help us drive profitability.

Okay great.

And then I guess, maybe just see.

The nextgen or the new.

New spinal fusion system, I guess is that still expected this year.

Or is that more of a 2026 launch.

I don't know if it has to do anything with how much momentum you guys are giving getting with response, if that's changing here.

I'm thinking around timing around the launch there, but any color there would be helpful.

Yes, it's certainly nexgen will be 2026 initiative, probably not a full blown launch in 2026.

But our hope is to start doing some cases, probably in the back part of 2026, youre fairly accurate in saying that.

Well from an R&D perspective, we're heads down making sure we've got the best system.

It's not critical imperative that that product gets launched right away when we see response growth as high as it is so we're certainly not throttling anything back.

But it's good to see that the when.

When Nexgen comes we think we will have an absolutely elite system, there and it will be building on the strength of response in an already growing product line in response.

And so so it's probably a 2026 to answer your question back part of 2026, probably a big launch in 2027 2028.

<unk> not factored into our revenue here this year or really much revenue in 2026.

Okay got you much appreciate you guys time and taking our questions today.

You bet. Thanks.

One moment for our next question.

Our next question comes from Richard <unk> with <unk> Securities. Your line is open.

Hi, Good afternoon. This is ravi in for rich.

Two questions. So the first one on three P. A number of kind of I don't know if from the line extensions or kind of new innovation and how to characterize that new innovation in this space.

But just around that can you help us understand how that gets you into I believe you talked about a $450 million Tam.

That opportunity like how does that allow you to penetrate that and then presumably should we be thinking of this longer term as kind of a leverage driver both SG&A as well as growth margins given that you have kind of a unified platform of products for production in kind of sale.

Thanks.

Yes. So there are as we mentioned the <unk> there was a number of different.

<unk> systems in a three piece that will be more targeted to anatomic areas or specific deformity correction opportunities I would say is that.

The.

I would say that we are opening a lot of new opportunities with <unk> because of our existing plating system doesn't have.

All of the indications covered and I would say is a little bit antiquated.

And so I think <unk> being kind of the flagship for our trauma and Lynn deformity product portfolio on a go forward basis.

Has a big impact on our capacity to grow the T&D business I think it probably gets us deeper Ravi into <unk>.

Existing accounts as you know we're present in every major children's hospital, but I think what we struggle sometimes with is that when their shelf space and shelf presence for things that are more commoditized and small plates and screws that have been there for a long time, it's going to take some more disruptive technology to to get those systems off the shelf.

And get newer more modern systems in and so I do think that as we do the full launch of the rupee over the next few years.

Youre going to see the opportunity for substantial displacement of more of the commoditized product and replace that with some pretty high technology products that also have very <unk> specific plates and screws shapes and sizes instruments that ultimately allow surgeons to do the procedures easier.

And so it's a big deal for Us and I do think it allows us to get deeper and deeper in the children's hospitals, where we're already present.

Yeah, and just to the leverage question, that's a great call out I mean, it's called a platform for a reason.

The design from the very beginning is to try to leverage this stuff and to really drive what we've been working on for the last really three to five years with all of our new product introductions, which has improved return on all of our assets that we're deploying and by combining this into our platform. We can then.

Leverage similar driver similar screws a lot of the similar items across multiple platforms, which gives us tremendous improved return on investment on these new sets coming out so more leverage there leverage with the supplier.

And then really on the SG&A side, so youll, probably see it show up more in improved gross margin.

But absolutely improved gross margin and better return on investment from a cash perspective is absolutely.

Multiple benefits from that type of a system launch.

Just sorry to amplify Fred's point on the asset utilization metrics here.

We've talked to the.

And the investment community for a long time about how our legacy products probably.

Some of those products that are in the market still.

Growing but they've been out there for 10, and 15 years and when we develop those products 15, nearly 20 years ago asset utilization metrics were not top of our list. When we were a tiny company 20 years ago, or 18 years ago and since the IPO and really over the last five years.

Ears.

<unk> new product development is not only focused on meeting major unmet clinical needs in pediatric health care, but also being able to do that where we're getting better asset utilization metrics, so either high ASP against or less inventory.

And I can say with confidence after seeing what we're getting on <unk> hip and what we're getting both from an ASP standpoint, as well as just the inventory required to do those elective procedures that the three P. First iteration of the <unk> platform is doing exactly as we want it's allowing surgeons to do procedures on kids they would.

Really struggle, otherwise and really high <unk>.

Demand types of patients, but it's also doing it at a really nice price point for us a really nice margin for us and.

I'm pretty excited to see the return on assets.

Meeting our needs.

Meaning of substantial improvement over some of our legacy products.

Great. Thanks for the Super Descriptive response, and then just maybe one last line no.

No I mean, it's an important product driver right. So and then just on the on the last kind of a question on the Q&A kind of just struck me around how youre thinking about Latin American growth right now and kind of Brazil as you kind of work your way through the dynamics there and.

When youre looking at kind of a long term, 12% outlook that youre that youre, putting out there for 'twenty six 'twenty seven and beyond.

How should we kind of think about if.

If youre looking at restart growth, obviously in that area of the world.

With a new business model potentially coming in.

Should we think about maybe trading some profitability revenue there or any kind of comments that you can kind of give us as you work through your new strategy there given the.

The changes you've seen in the last couple of months will be very helpful into 'twenty six.

Yes, what I would say is I think you should expect more of the same in that.

Revenue is important.

But improving profitability and improving free cash flow is as important.

And so it is not revenue at all cost it's revenue that's profitable and its revenue that generates free cash flow.

Cash flow for us.

And any change that we do I think in the business you could assume is going to follow the same principles. So it's not necessarily going to maximize revenue growth, but more importantly.

The profitability of sales down there as well as improve the dramatically improved the cash flow of that operation.

Thank you I'm not showing any further questions at this time I would like to turn the call back over to Dave for any further remarks.

Well. Thank you for everybody for your good questions. Thank you for your time and I'd just like to thank all of my associates and partners in pediatric health care and our investors for continuing to share in our mission to help 1 million kids a year have a very.

Good day, and we'll look forward to talking to you soon.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

Q3 2025 OrthoPediatrics Corp Earnings Call

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