Zimmer Biomet
(NYSE: ZBH)
announced today that it signed a definitive agreement to acquire OrthoGrid Systems.
The company also posted second-quarter results that came in ahead of the consensus forecast. Despite both the strong earnings report and the acquisition, investors had a slightly negative reaction as the company cut its 2024 sales guidance
Shares of ZBH dipped 2.7% to $106.63 apiece in early-morning trading today. MassDevice’s MedTech 100 Index — which includes stocks of the world’s largest medical device companies — fell slightly.
OrthoGrid Systems develops AI-driven surgical guidance systems for total hip replacement. The acquisition includes OrthoGrid’s AI-powered, fluoroscopy-based surgical assistance platform Hip AI. It also adds two more FDA-cleared orthopedic applications and over 40 patents to Zimmer Biomet’s portfolio.
The Hip AI system provides real-time image analysis, automated measurements of leg length and offset and optimal cup placement guidance. All the while, it maintains a small operating room footprint. Surgeons can also tailor Hip Ai to align with their specific technique and workflow.
Richard Boddington, OrthoGrid Systems co-founder and co-CEO, said the acquisition helps the company expand its reach.
Zimmer Biomet declined to disclose financial terms. It expects to complete the deal by the end of the fourth quarter of 2024.
“OrthoGrid’s AI systems address the rapidly growing market demand for fluoroscopy-based surgical guidance solutions while strengthening our portfolio of hip offerings that drive intraoperative efficiencies and improve the quality of life for patients,” said Jim Lancaster, president, Recon and global headquarters executive director at Zimmer Biomet. “We pride ourselves on being customer-centric and Hip AI exemplifies our commitment to offer solutions that meet the specific needs of each surgeon.”
Zimmer Biomet also reports second-quarter results
The Warsaw, Indiana–based orthopedic device giant — one of the largest ortho companies in the world — reported profits of $243.1 million. That equals $1.18 per share on sales of $1.942 billion for the three months ended June 30, 2024.
Zimmer Biomet recorded a 15.8% bottom-line gain on a sales uptick of 3.9%.
Adjusted to exclude one-time items, earnings per share came in at $2.01. That landed 2¢ ahead of expectations on Wall Street. Sales fell in line with expectations as experts forecast $1.94 billion in revenue.
“We delivered a strong Q2 – beating our expectations on both the top and bottom line, driven by customer demand for our suite of diversified products and solutions, as well as the strength and breadth of our international business,” said Ivan Tornos, Zimmer Biomet’s president and CEO. “Our performance demonstrates the progress we are making against our key priorities that support our long-range plan – people and culture, operational excellence, and innovation and diversification.”
Zimmer Biomet cut its sales guidance for 2024 from between 4.5% and 5.5% to between 4% and 5%. It reaffirmed its adjusted EPS guidance for between $8 and $8.15 for the full year.
