Zimmer Biomet (NYSE: ZBH) shares took a massive hit today on third-quarter results that came in mixed compared to the consensus forecast.
Shares of ZBH fell more than 15% to $86.77 apiece in morning trading today.
The Warsaw, Indiana–based orthopedic giant reported profits of $230.9 million. That equals $1.16 per share on sales of $2 billion for the three months ended Sept. 30, 2025.
Zimmer Biomet recorded a 7.3% bottom-line decline on a 9.7% sales increase.
Adjusted to exclude one-time items, earnings per share came in at $1.90. That landed 4¢ ahead of the forecast on Wall Street. Sales came in just shy of expectations, though, as experts projected $2.01 billion in revenue.
Ivan Tornos, chair, president and CEO of Zimmer Biomet, said the company delivered strong performance in the U.S. However, it faced weakness in Latin America, emerging European markets and non-core businesses. He said the company identified these weaknesses late in the quarter and issues “are being addressed.”
Zimmer Biomet reaffirmed its 2025 guidance for sales growth between 6.7% and 7.7% and adjusted EPS between $8.10 and $8.30. It narrowed its full-year constant currency and organic constant currency revenue growth guidance to reflect currency expectations.
Noteworthy recent developments at Zimmer Biomet include the completion of its acquisition of Monogram Technologies (after announcing the agreement to acquire the company during the third quarter) and approvals for its iodine-treated hip replacement system. The company also inked a partnership with Getinge around ambulatory surgery centers (ASCs).
Also during the quarter, Zimmer Biomet filed a lawsuit alleging that Deloitte sold it a ‘disaster’ of an enterprise resource planning (ERP) software system that ended up costing tens of millions of dollars to fix.
Commentary from Zimmer Biomet leadership and analysts
Tornos said the company’s performance was bolstered by revenue growth in its critical U.S. business, driven by accelerated adoption of key new products.
“This is highly encouraging, especially as we prepare to launch a second round of new-to-the-world technologies, including the first fully autonomous robot in orthopedics and our iodine treated hip, the world’s first orthopedic implant with iodine technology that inhibits bacterial adhesion and prevents biofilm formation to help address periprosthetic joint infections,” Tornos said. “We are excited to launch our iodine treated hip in Japan soon, having received PMDA approval in September. All that said, our strong performance in the U.S. was partially offset by weakness in Latin America, Emerging Markets in Europe and non-core businesses, which emerged late in the quarter and are being addressed.”
BTIG analysts Ryan Zimmerman and Iseult McMahon maintain a “Buy” rating for Zimmer Biomet but marked the quarter as “disappointing.” They still see “limited” downside at the company’s current valuation.
“There is no way to spin it, results were disappointing relative to expectations as ZBH came off a strong 2Q and into the print, investor enthusiasm was growing from an easier comp and new product launches,” the analysts wrote. “We think the road ahead is about consistent, reproducible execution that reestablishes ZBH credibility to investors, but a nagging question into FY26 will be whether ZBH can achieve its long-term targets.”
