What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-05 compared with 2025-10-30 · 184 added, 276 removed, 209 unchanged (69% of the section changed)

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We have made statements in this Quarterly Report that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”).

All statements other than statements of historical fact contained in this Quarterly Report, including, but not limited to, statements regarding our business strategy and plans, our growth and growth strategies, developments in the markets for our products and services, financial results, our planned product launches and effectiveness, our research and development strategy, regulatory approvals, our competitive strengths, objectives of management for future operations and current expectations or forecasts of future results, our expectations regarding the Boston facility and plans to operationalize the Company's manufacturing facility in Braintree, Massachusetts (“the Braintree facility”), our transition of the manufacture of SurgiMend® and PriMatrix® to the Braintree facility, our ability to obtain a pre-market approval (“PMA”) of SurgiMend PRS in implant-based breast reconstruction and to obtain a PMA for Durasorb® in 2026 for multiple indications for implant-based breast reconstruction, our expectations regarding the Compliance Master Plan (“the CMP”) implementation and engagement, our restructuring and cost-saving initiatives, our intellectual property rights, litigation and tax matters, governmental proceedings and investigations, mergers and acquisitions, divestitures, market acceptance of our products and services, accounting estimates, financing activities, ongoing contractual obligations and compliance with restrictive and financial covenants of our outstanding indebtedness, working capital adequacy, value of our investments, our effective tax rate, estimates regarding the impact of tariffs adopted or implemented by the U.S.

All statements other than statements of historical fact contained in this Quarterly Report, including, but not limited to, statements regarding our future business, operational and financial performance and the Company’s expectations and plans with respect to market opportunity, business and operational performance, strategic initiatives, capabilities, resources , manufacturing capabilities, product development, product availability and regulatory approvals, including our plans to operationalize the Company’s manufacturing facility in Braintree, Massachusetts (“the Braintree facility”), our expectations regarding the Compliance Master Plan (“the CMP”) implementation, engagement and efficacy, our restructuring and cost-saving initiatives, our intellectual property rights, litigation and tax matters, governmental proceedings and investigations, mergers and acquisitions, divestitures, market acceptance of our products and services, accounting estimates, financing activities, ongoing contractual obligations and compliance with restrictive and financial covenants of our outstanding indebtedness, working capital adequacy, value of our investments, our effective tax rate, estimates regarding the impact of tariffs adopted or implemented by the U.S.

or other countries on our business, financial condition and results of operations, our expected returns to shareholders, and our sales efforts, are forward-looking statements.

In some cases, these forward-looking

statements may be identified by forward-looking words such as “believe,” “may,” “might,” “could,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “seek,” “plan,” “expect,” “should,” “would” or the negative version of these words or other similar words and expressions in this Quarterly Report.

In some cases, these forward-looking statements may be identified by forward-looking words such as “believe,” “may,” “might,” “could,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “seek,” “plan,” “expect,” “should,” “would” or the negative version of these words or other similar words and expressions in this Quarterly Report.

These forward-looking statements are subject to a number of risks, uncertainties and assumptions about the Company and other matters that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements.

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Such risks and uncertainties include, but are not limited, to the following:

the ongoing and possible future effects of global challenges, including macroeconomic uncertainties, inflation, supply chain disruptions, trade regulation and tariffs, political instability, violent conflicts, and other macroeconomic disruptions and U.S.

and global recession concerns, on the Company’s customers and on the Company’s business, financial condition, results of operations and cash flows;

the Company's ability to execute its operating plan effectively;

the Company’s ability to successfully integrate acquired businesses;

the Company’s ability to achieve sales growth in a timely fashion;

the Company’s ability to manufacture and ship sufficient quantities of its products to meet its customers’ demands;

the ability of third-party suppliers to supply us with raw materials and finished products;

the Company’s ability to manage its direct sales channels effectively;

the sales performance of third-party distributors on whom the Company relies to generate revenue for certain products and geographic regions;

the Company’s ability to access and maintain relationships with customers of acquired entities and businesses;

physicians’ willingness to adopt and third-party payors’ willingness to provide or maintain reimbursement for the Company’s recently launched, planned and existing products;

initiatives launched by the Company's competitors;

downward pricing pressures from customers;

the Company's ability to secure regulatory approval for products in development;

increased geopolitical tension, instability and other macroeconomic factors, including trade barriers and related restrictions (including tariffs and related countermeasures), armed conflict and acts of terrorism, supply chain disruptions, and interest rate and foreign currency rate fluctuations on the Company’s suppliers, vendors and customers and on the Company’s business and financial condition, results of operations and cash flows;

the Company's ability to execute its financial, strategic and operating plans effectively;

the Company’s ability to remediate quality systems violations;

difficulties or delays in obtaining and maintaining required regulatory approvals related to the transition of manufacturing SurgiMend and PriMatrix to the Braintree facility and obtain PMA of SurgiMend PRS in implant-based breast reconstruction (“IBBR”);

the possibility that costs or difficulties related to building and the operationalization of the Braintree facility or the transition of manufacturing activities from the Company’s Boston facility to the Braintree facility will be greater than expected;

fluctuations in hospitals’ spending for capital equipment;

the Company’s ability to comply with regulations regarding products of human origin and products containing materials derived from animal source;

the impact of changes in management or staff levels;

the impact of goodwill and intangible asset impairment charges if future operating results of acquired businesses are significantly less than the results anticipated at the time of the acquisitions, the Company’s ability to leverage its existing selling organizations and administrative infrastructure;

the Company’s ability to increase product sales and gross margins, and control both product and non-product costs and expenses;

the amount and timing of divestiture, acquisition and integration-related costs;

difficulties in implementing the CMP;

difficulties or delays in obtaining and maintaining required regulatory approvals, including the costs thereof;

potential difficulties, delays and disruptions in manufacturing, distribution or sale of products;

the failure of the company’s suppliers, vendors, and other third parties to meet contractual, regulatory and other obligations;

the anticipated development of markets the Company sells its products into and the success of the Company’s products in these markets;

the Company’s ability to predict accurately the demand for its products and products under development;

increasing industry competition;

the coverage and reimbursement decisions of third-party payors;

trends toward health care cost containment;

difficulties in controlling expenses, including costs to procure and manufacture the Company’s products;

the ability of the Company to successfully manage leadership and organizational changes and the impact of changes in management or staff levels;

the impact of goodwill and intangible asset impairment charges if future operating results of acquired businesses are significantly less than the results anticipated at the time of the acquisitions;

the geographic distribution of where the Company generates its taxable income;

and foreign government laws and regulations, and changes in existing laws, regulations and enforcement guidance, which affect areas of our operations including, but not limited to, those affecting the health care industry, including the EU Medical Device Regulation (“EU MDR”);

the scope, duration and effect of additional U.S.

and international governmental, regulatory, fiscal, monetary and public health responses to public health crises;

changes to applicable laws, regulations and enforcement guidance, including tax laws and global health care reforms;

fluctuations in foreign currency exchange rates;

the amount of our bank borrowings outstanding and other factors influencing liquidity;

our ability to comply with the covenants under the agreements governing our indebtedness and the potential negative consequences caused by non-compliance;

potential negative impacts resulting from environmental, social and governance matters;

disruptions at the FDA, including due to a reduction in the FDA’s and CMS’ workforce and/or inadequate funding for the FDA or CMS;

the impact of the U.S.

government shutdown which began in October 2025 on our business operations;

breaches, failures or other disruptions of our or our vendors’ or customers’ information technology systems or products;

and the potential impact of our compliance with governmental regulations and accounting guidance.

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You should carefully consider forward-looking statements and understand that such forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, and involve a variety of risks and uncertainties.

Integra LifeSciences Holdings Corporation was founded in 1989 and is a leading global medical technology company innovating treatment pathways to advance patient outcomes and set new standards of surgical, neurologic, ear, nose, and throat (“ENT”) and tissue technologies.

Our common stock trades on the Nasdaq Global Select Market under the symbol “IART.” We have developed numerous product lines from our technologies for applications ranging from burn and deep tissue wounds to the repair of dura mater in the brain, as well as nerves and tendons.

We have expanded our base regenerative technology business to include ENT, surgical instruments, neurosurgical products and advanced wound care through global acquisitions and product development to meet the evolving needs of our customers and enhance patient care.

Our products are sold in more than 120 countries through a direct sales force as well as distributors and wholesalers.

Integra LifeSciences Holdings Corporation is a global medical technology company dedicated to restoring lives.

We are advancing transformational care through impactful innovation and our portfolio of highly differentiated technologies is trusted by healthcare professionals to deliver transformative care.

We manufacture and sell medical technologies and products in two reportable business segments:

Codman Specialty Surgical (“CSS”) and Tissue Technologies (“TT”).

The CSS segment, which represents approximately 70% of our total revenue, consists of market-leading technologies and instrumentation used for a wide range of specialties, such as neurosurgery, neurocritical care and otolaryngology.

Specialty Surgery (formerly, Codman Specialty Surgical) and Tissue Reconstruction (formerly, Tissue Technologies).

The Specialty Surgery segment, which represents approximately 70% of our total revenue, consists of market-leading technologies and instrumentation used for a wide range of specialties, such as neurosurgery, neurocritical care, and otolaryngology, commonly referred to as ear, nose, and throat (“ENT”).

We are the world leader in neurosurgery and one of the top three providers in the U.S.

in instruments used in precision, specialty, and general surgical procedures.

Our TT segment generates approximately 30% of our overall revenue and focuses on three main areas:

complex wound surgery, surgical reconstruction, and peripheral nerve repair.

Our Tissue Reconstruction segment generates about 30% of our overall revenue and focuses on wound reconstruction and private label.

We have key manufacturing and research facilities located in California, Maryland, Massachusetts, New Jersey, Ohio, Puerto Rico, Tennessee, Utah, France, Germany, Ireland, Israel and Switzerland.

We source most of our handheld surgical instruments and dural sealant products through specialized third-party vendors.

Our strategies are focused around five pillars.

Of these five pillars, three are core growth drivers:

(1) innovating for outcomes, (2) growing internationally, and (3) broadening our impact on care pathways.

Our execution of the core growth drivers is enabled by two additional pillars:

(4) driving operational and customer excellence and (5) cultivating a high-performance culture.

As outlined in greater detail below, we believe these five pillars will enable us to realize and advance our integrated growth strategy.

To this end, our executive leadership team has established the following key priorities aligned to our five pillars:

Innovating for Outcomes .

An important part of our growth strategy is introducing new products to strengthen and expand our portfolio through clinical evidence to support regulatory approval and strong reimbursement of our product portfolio around the world, including new indications for existing technologies.

In 2021, we filed a PMA application for a specific indication for SurgiMend in the use of post-mastectomy IBBR.

We currently anticipate PMA approval following the completion of the construction, successful pre-approval inspection and operationalization of our Braintree facility, which is expected in 2026.

We are also pursuing a PMA for DuraSorb for indications in the use of IBBR.

We completed enrollment and subject treatment for the DuraSorb U.S.

investigational device exemption (“IDE”) clinical trial for two-stage breast reconstruction in 2023 and we continue to advance the PMA application.

Currently, we hope to secure PMA approval for DuraSorb in 2026.

In 2024 we expanded our urinary bladder matrix platform with the U.S.

launch of MicroMatrix® Flex, a dual-syringe system enabling the convenient mixing and precise delivery of MicroMatrix paste to provide convenient access to hard-to-reach spaces and to help prepare an even surface in challenging wound areas.

Additionally, in 2024, we successfully re-launched our CereLink ® intracranial pressure (“ICP”) monitor system.

CereLink provides advanced continuous ICP monitoring when treating patients with traumatic brain injuries and offers enhanced accuracy, usability and advanced data presentation compared to other leading ICP monitoring systems.

Growing Internationally.

Over the years, we have significantly expanded our global footprint by investing in our commercial and manufacturing operations, as well as introducing new products.

In the last two years, we have expanded our presence in key markets such as Southeast Asia, India, South Korea and Brazil.

As part of our In-China-For-China strategy, we continue to build out our assembly capabilities in our facility in Suzhou, China.

In 2023 and 2024, DuraGen Plus, an absorbable and sutureless collagen onlay indicated as a dura substitute for the repair of dura mater, and Certas Plus were approved in China.

Several new products were also introduced in select international markets in 2023 and 2024, including MicroMatrix and Certas Plus® Programmable Valve (MDR certification), which were launched in Europe, and CUSA Clarity laparoscopic tip, which was launched in Australia, New Zealand, Japan, Canada, Brazil, South Africa and Israel.

In 2025, Cerelink received approval in Brazil, Philippines, UAE, Albania and India.

Broadening Impact on Care Pathways .

We seek ways to develop and acquire products and technologies that impact the lives of patients, starting with the journey that a patient takes from diagnosis and treatment planning to surgery and postoperative care.

We are well-established in acute care settings and continue to leverage that strong position to grow in this segment and shape treatment pathways into preoperative care and additional sites of care.

In April 2024, we successfully completed the acquisition of Acclarent, Inc.

(“Acclarent”).

Acclarent is an innovator and market leader in ENT procedures and the acquisition of Acclarent has positioned us as one of the leading providers of ENT products and technologies.

Furthermore, we believe that, owing to the ENT business being an anatomical adjacency to neurosurgery, Acclarent will allow us to deliver future innovation both within the ENT business and across our other CSS technology platforms.

Driving Operations and Customer Excellence.

We have been steadily advancing our initiatives to build more responsive and scalable processes, enhance the reliability of our quality systems and supply chain, and drive productivity to further our supply and lower costs.

We continue to invest in technologies, systems and processes to enhance the customer experience.

We are also committed to our capacity expansion.

We have progressed in the transfer from our Boston facility to our Braintree facility, as well as expanding capacity at our manufacturing facility in Plainsboro, New Jersey.

In an effort to enhance our manufacturing flexibility and resilience, we entered into a new third-party manufacturing agreement, which allowed us to relaunch PriMatrix and Durepair ahead of previously disclosed timelines.

Both products are now currently available to our customers.

Additionally, we are implementing the CMP, a systematic and holistic approach to improving our quality management system across our manufacturing and supply network.

The primary objectives of the CMP are to remediate quality system gaps, harmonize the quality management system and enhance the quality culture across the Company.

Cultivating a High-Performance Culture.

In seeking to sustain a culture of excellence and accountability, we focus on employee empowerment, professional development and building an environment where all employees can contribute to their fullest potential.

These efforts have been recognized through our inclusion in several best workplace lists globally.

We continue to advance our broader organizational sustainability initiatives, and published our annual environmental, social and governance (“ESG”) report in the third quarter of 2025.

For more information on our ESG strategy, goals, performance, and achievements, please visit “Our Company—ESG Report” at https://www.integralife.com/esg-report.

Information on our website is not incorporated by reference herein and is not part of this Quarterly Report on Form 10-Q.

New Product Introductions and Research and Development Updates

We continue to invest in collecting clinical evidence to support our existing products and new product launches, and to ensure that we obtain market access for broader and more cost-effective solutions.

Neurosurgical Solutions, Surgical Instruments, and ENT Solutions.

The CSS neurosurgical business consists of a broad portfolio of market-leading brands, such as Codman®, DuraGen, DuraSeal®, CUSA®, CereLink, Mayfield®, Bactiseal®, and Certas Plus, which are used for the management of multiple disease states, including brain tumors, traumatic brain injury, hydrocephalus and other neurological conditions.

OUR PRODUCTS, SERVICES AND TECHNOLOGIES

We were the first company to receive an FDA claim for regeneration of dermal tissue and are a world leader in regenerative technology.

We have developed numerous product lines from this technology for applications ranging from burn and deep tissue wounds to the repair of dura mater in the brain, as well as nerves and tendons.

We have expanded our base regenerative technology business to include neurosurgical products, ENT, surgical instruments and wound reconstruction solutions through global acquisitions and product development to meet the evolving needs of our customers and enhance patient care.

SPECIALTY SURGERY

Neurosurgery :

In neurosurgery, we are a global leader in neuro-access, neuro-surgical and neuro-monitoring technologies.

Our product portfolio represents a continuum of care from pre-operative, to the neurosurgery operating room, to the neuro-critical care unit and post care for both adult and pediatric patients suffering from brain tumors, brain injury, cerebrospinal fluid pressure complications and other neurological conditions.

This portfolio features leading brands such as Codman, Duraseal, CUSA, Mayfield and Duragen.

We offer leading technologies in dural repair, ultrasonic tissue ablation, intracranial pressure (“ICP”) monitoring, hydrocephalus management, and cranial stabilization systems, while providing a rich research and development pipeline for growth.

Surgical Instruments :

Our specialty instrumentation portfolio includes a catalog of surgical headlamps, surgical instruments, as well as after-market service.

With thousands of surgical instrument products, comprised of a comprehensive portfolio of reusable and disposable instruments, including forceps, retractors, scissors, and curettes, tailored for neurosurgery and spine surgery including specialty surgical instruments, we call on the central sterile processing unit of hospitals and acute care surgical centers.

Additionally, through a strong U.S.

distribution model, we can serve the needs of medical offices.

ENT Solutions :

The Company’s ENT portfolio comprises a broad range of products including the TruDi® Navigation System featuring navigated surgical instrumentation, the RELIEVA SPINPLUS® Balloon Sinuplasty System, the AERA® Eustachian Tube Dilation System, and the MicroFrance ENT instrumentation line.

TISSUE RECONSTRUCTION

Our Tissue Reconstruction segment develops and markets a broad portfolio of regenerative tissue products and technologies primarily focused on wound reconstruction and care and private label.

This segment serves a diverse range of specialties, including plastic and reconstructive surgery, general surgery, and wound management.

We currently utilize five unique regenerative technology platforms consisting of highly engineered bovine collagen (derived from bovine sources for structural support), bovine dermis (acellular dermal tissue for natural integration), porcine urinary bladder (extracellular matrix for cellular repopulation), human amniotic tissue (allografts as a wound cover), and resorbable synthetic mesh (biodegradable materials for temporary reinforcement).

These technologies address clinical needs in treating acute wounds such as burns, chronic wounds including diabetic foot ulcers, and surgical tissue repair applications such as hernia reinforcement, tendon protection, and peripheral nerve repair.

Wound Reconstruction:

We offer a broad portfolio of products and solutions addressing a full spectrum of needs when managing complex wounds including acute wounds (e.g., burns and trauma), chronic wounds (e.g., diabetic foot ulcers and venous ulcers), and other complex wound types.

The goal is to support the body’s wound healing process by providing scaffolds that create a wound environment that facilitates cellular invasion and revascularization.

These products are often used in hospital settings, wound care clinics, or outpatient procedures.

We offer a continuum of advanced solutions for plastic and reconstructive surgery, complex hernias, and general surgery, including devices for implantation to reinforce soft tissue where weakness exists and for surgical repair of damaged or ruptured soft tissue membranes.

These products provide structural support and promote tissue integration to address areas of tissue weakness.

They are bioresorbable or acellular to minimize long-term foreign body reactions and reduce complications like adhesions or infections.

Private Label :

We offer extensive expertise in collagen biomaterials for other medical technology companies that sell to end markets primarily in spine, surgical and wound care.

We manufacture a broad set of our regenerative and wound care technologies that are available for private label distribution by our customers, produce raw materials that can be integrated into our customers’ production processes, and have the expertise to design, develop and manufacture products to meet the specific needs of our customers.

RESEARCH AND DEVELOPMENT STRATEGY

An important part of Integra’s growth strategy is introducing new products to strengthen and expand our portfolio through clinical evidence to support regulatory approval and strong reimbursement of our product portfolio around the world, including new indications for existing technologies.

Our research and development activities focus on identifying unmet surgical needs and addressing those needs with innovative solutions and products.

Investment in research and development is critical to driving our future growth.

Our research and development efforts are focused on the further development and improvement of our existing products, the design and development of new innovative medical technologies and regulatory compliance across all our business segments.

We apply our core competency in regenerative technology to innovate products for neurosurgical, wound applications, plastic surgery, and reconstructive surgery and we have extensive R&D development programs for our core platforms of electromechanical technologies.

Additionally, we conduct projects and clinical studies to generate efficacy and health economic evidence.

The Company has continued its investments in clinical education as a key value driver to leverage its global footprint, enhanced digital content, and strengthened its clinical network.

As part of this objective, the Company remains committed to participation in clinical research demonstrating the efficacy of its products prior to market introduction, and in supporting the clinical education and technical training.

Neurosurgery, Surgical Instruments, and ENT Solutions.

The Specialty Surgery neurosurgical business consists of a broad portfolio of market-leading brands, which are used for the management of multiple disease states, including brain tumors, traumatic brain injury, hydrocephalus and other neurological conditions.

The growth in this business in recent years has been fueled by geographic expansion and new product registrations in markets, such as China, Japan, and Europe, which we expect to continue in the near-to-long term.

Because our electromechanical products and instruments address significant needs in surgical procedures and limit uncertainty for surgeons, we continue to invest in registrations, clearances, and approvals for new indications and next generation improvements to our market-leading products.

We have several active programs focused on life cycle management and innovation for capital and disposable products in our portfolio.

Our product development efforts are focused on core clinical applications in cerebrospinal fluid management, neuro critical care monitoring, minimally invasive instruments and electrosurgery and ultrasonic medical technologies, as well as our ambition to transform the standard of care in neurosurgery with product advancements in minimally invasive surgery and the surgical management of intracerebral hemorrhage.

We continue to advance the early-stage technology platforms we acquired in 2019.

Through the acquisition of Arkis Biosciences, Inc.

(“Arkis”) we added a platform technology, CerebroFlo® external ventricular drainage (“EVD”), a catheter with Endexo® technology.

Our product development efforts are focused on core clinical applications in cerebrospinal fluid (“CSF”) management, neuro-critical care monitoring, minimally invasive instruments and electrosurgery and ultrasonic medical technologies, as well as our ambition to transform the standard of care in neurosurgery with product advancements in minimally invasive surgery (“MIS”) and the surgical management of intracerebral hemorrhage (“ICH”).

We continue to advance the CerebroFlo® external ventricular drainage (“EVD”), a catheter with Endexo® technology.

The Endexo polymer in polyurethane is a permanent additive which has shown to be effective in reducing platelet adhesion in-vitro, reducing thrombus accumulation in-vitro and in vivo, and reducing the clinical incidence of thrombus formation.

In vitro evaluations and in vivo animal evaluations do not necessarily predict the clinical performance of the SureFlo EVD Catheter with respect to thrombus formation.

The incidence of thrombus formation on polyurethane containing Endexo polymer in other medical devices and/or tissues systems does not necessarily predict the clinical performance of the SureFlo EVD Catheter for the intended use of CSF external drainage and monitoring.

The CerebroFlo EVD catheter has demonstrated an average of 99% less thrombus accumulation onto its surface, in vitro, compared to a market leading EVD catheter.

Our work to combine our Bactiseal antimicrobial technology with the Endexo anti-occlusive technology continues to progress for both a silicone-based hydrocephalus and EVD product.

We also continue to advance our innovation from 2019 acquisition of Rebound Therapeutics Corporation (“Rebound Therapeutics”).

Rebound Therapeutics specializes in a single-use medical device, known as the Aurora® Surgiscope, which is the only tubular retractor system designed for cranial surgery with an integrated access channel, camera and lighting.

The 15mm x 60mm and 15mm x 80mm Aurora Surgiscope System received 510(k) clearance from the FDA in 2025.

In 2024 we acquired Acclarent, expanding our capabilities in the U.S.

Acclarent pioneered the balloon sinuplasty market and has a broad portfolio including the RELIEVA SPINPLUS® Balloon Sinuplasty System.

Acclarent also pioneered eustachian tube balloon dilation and currently markets the AERA® Eustachian Tube Dilation System, which received 510(k) clearance for expanded pediatric indications in 2023.

In addition, Acclarent sells the TruDi® Navigation System, which

includes a portfolio of navigated surgical instrumentation.

In July 2025, we announced the inaugural enrollment of the first patient in the Acclarent AERA Pediatric Registry, a prospective, multi-center observational registry evaluating the real-world use of the AERA Eustachian Tube Balloon Dilation System in children.

We also continue to advance the Aurora® Surgiscope, which is the only tubular retractor system designed for cranial surgery with an integrated access channel, camera and lighting.

The 15mm x 60mm and 15mm x 80mm Aurora Surgiscope System version received 510(k) clearance from the FDA in 2025.

In July 2025, we announced the inaugural enrollment of the first patient in the AERA Pediatric Registry, a prospective, multi-center observational registry evaluating the real-world use of the AERA Eustachian Tube Balloon Dilation System in children.

This marks the focused effort to measure the ongoing, clinical performance of AERA in pediatric patients with obstructive Eustachian tube dysfunction.

The registry is designed to capture both safety and efficacy outcomes for up to 300 pediatric patients who undergo Eustachian tube balloon dilation using AERA.

In 2024, we acquired the product rights for Durepair Dural Regeneration Matrix, a suturable dural graft which complements our portfolio of dural grafts and sealants, and subsequently launched the product for commercial sale in the U.S.

in October 2025.

In September 2025, the Mayfield® Ghost Base Unit Post launched in the U.S., which is designed to help provide clear visualization of anatomical structure and to support surgical accuracy and patient positioning.

In November 2025, we received 510(k) clearance for the use of the CUSA Clarity system for cardiac surgeries, used for the debridement of unwanted tissue in cardiac surgeries, including valve replacement and repair.

Regenerative Technologies .

We were the first company to receive FDA approval for regeneration of dermal tissue and are a world leader in regenerative technology.

Our regenerative technology development program applies our expertise in bioengineering to a range of biomaterials including natural materials such as purified collagen, intact human or animal tissues, honey as well as resorbable synthetic polymers with our DuraSorb and DuraSeal® product lines.

These unique product designs are used for neurosurgical and reconstructive surgical applications, as well as dermal regeneration, including the management of chronic and acute wounds, tendon and nerve repair.

These unique product designs are used for neurosurgical and reconstructive surgical applications, as well as dermal regeneration.

Our regenerative technology platform includes our legacy Integra® Dermal Regeneration Template (“IDRT”) products and complementary technologies that we have acquired.

Our collagen manufacturing capability, combined with our history of innovation, provides us with strong platform technologies for multiple indications.

In 2021, we filed a PMA application for a specific indication for SurgiMend for use in post-mastectomy IBBR and in 2024 received approvable pending Good Manufacturing Practice (“GMP”) status from the FDA, which approved and closed out the clinical portion of this PMA application.

We anticipate PMA approval following successful closeout of the GMP deficiencies, pre-approval inspection, and operationalization of the Braintree facility, which is expected in 2026.

In 2022, we acquired SIA, which also submitted a PMA application for multiple indications for DuraSorb for use in IBBR.

In 2023 we completed enrollment in the DuraSorb U.S.

IDE clinical trial for two-stage breast reconstruction, and since then have completed treatment and follow up of all subjects as we continue to advance the PMA application.

In the third quarter of 2021, we filed a PMA application for a specific indication for SurgiMend® in the use of post-mastectomy breast reconstruction and in July 2024 received approvable pending GMP status from FDA, which approved and closed out the clinical portion of this PMA application.

We currently expect the Braintree facility to be operational in June 2026, with PMA approval anticipated to follow in 2027.

We are also pursuing a PMA for DuraSorb for use in implant-based breast reconstruction (“IBBR”).

We completed enrollment for the DuraSorb U.S.

investigational device exemption clinical study for two-stage breast reconstruction in June 2023;

completed treatment in 2024, completed patient 1-year follow up in 2025, and we continue to advance the PMA application.

Currently, we hope to secure PMA approval for DuraSorb in 2027.

By offering two distinct product solutions for multiple indications, we believe we have the opportunity to build a leading position in the IBBR market.

In 2024, MicroMatrix Flex, used in the management of wounds with hard-to-reach geometries, such as deep wounds that present with tunneling or undermining, became commercially available in the U.S.

in October 2025.

EUROPEAN UNION MEDICAL DEVICE REGULATION UPDATES

We continue to work towards certifying our products under the EU MDR.

In recent years, we received EU MDR certification in our CSS segment for Hakim Programmable Valves, Certas Plus with and without Bactiseal catheters, Surgical Patties and Strips, DuraSeal Dural, and DuraGen Suturable, as well as IDRT, BioPatch, MicroMatrix, and Cytal in our TT segment.

Although we do not currently anticipate any significant disruption to our commercial activities in Europe related to EU MDR, we cannot provide assurance of our ability to timely comply with all applicable requirements of EU MDR and our failure to meet the applicable EU MDR requirements could adversely impact our business in the EU and other regions that tie their product registrations to the EU requirements.

In recent years, we received EU MDR certification in our Specialty Surgery segment for Hakim Programmable Valves, Certas Plus with and without Bactiseal catheters, Surgical Patties and Strips, DuraSeal Dural and Xact, CUSA Clarity, DuraGen Suturable, Cranial Drills and Perforators, as well as IDRT, BioPatch, MicroMatrix, and Cytal in our Tissue Reconstruction segment.

We do not currently anticipate any significant disruption to our commercial activities in Europe related to EU MDR.

On December 19, 2024, the Company received a warning letter from the FDA (the “2024 Warning Letter”).

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The 2019 Warning Letter was related to quality systems issues at TEI’s manufacturing facility located in Boston, Massachusetts (the “Boston facility”).

The Boston facility manufactured extracellular bovine matrix products in our TT segment that were sold both in wound reconstruction and care and surgical reconstruction franchises, and in private label channels.

The Boston facility manufactured extracellular bovine matrix products in our Tissue Reconstruction segment that were sold both in wound reconstruction and care and surgical reconstruction franchises, and in private label channels.

The 2019 Warning Letter resulted from an inspection held at the Boston facility in October and November 2018 and did not identify any new observations that were not already provided in the Form 483 that followed the inspection.

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The Company anticipates the Braintree facility to be operational in 2026.

In addition, the Company entered into a new third-party manufacturing agreement, which facilitated the relaunch of PriMatrix, as well as Durepair Dural Regeneration Matrix, ahead of previously disclosed timelines.

In addition, the Company entered into a new third-party agreement, which facilitated the relaunch of PriMatrix, as well as Durepair Dural Regeneration Matrix in 2025, ahead of previously disclosed timelines.

We cannot give any assurances that the FDA will be satisfied with our response to the issues identified by the FDA in any of the foregoing Form 483s or warning letters or as to the expected date of the resolution of such issues.

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Any adverse regulatory action, depending on its magnitude, may restrict us from effectively manufacturing, marketing and selling our products and could have a material adverse effect on our business, financial condition and results of operations.

Optimization and Integration Activities

As a result of our ongoing acquisition strategy and significant growth in recent years, we have undertaken cost-saving initiatives to consolidate manufacturing operations, distribution facilities and transfer activities, eliminate duplicative positions, realign various sales and marketing activities, and expand and upgrade production capacity for our regenerative technology products.

These efforts are expected to continue and while we expect a positive impact from ongoing restructuring, integration, and manufacturing transfer and expansion activities, such results remain uncertain.

As a result of audits and inspections by regulatory agencies as well as our own review of the Company’s quality management system, we are in the process of implementing the enterprise-wide CMP, a systematic and holistic approach to improving our quality management system across our manufacturing and supply network.

The primary objectives of the CMP are to remediate quality system gaps, harmonize the quality management system and enhance the quality culture across the Company.

OPTIMIZATION ACTIVITIES

As a result of audits and inspections by regulatory agencies as well as our own review of the Company’s quality management system, we have implemented our enterprise-wide CMP, with the objective of providing a systematic and holistic approach to improving our quality management system across our manufacturing and supply network.

The primary objectives of the CMP are to remediate quality system gaps, harmonize our quality management system and enhance the quality culture across the Company.

The Company has completed baseline audits across all manufacturing facilities, conducted CMP training, and has made significant progress in its prioritized work streams.

Our efforts to implement the CMP are expected to continue and although we anticipate improvements to our quality management system, such results remain uncertain.

In the fourth quarter of 2025, we approved a restructuring initiative to improve the Company’s operational performance by strengthening the stability and resilience of our supply chain, strengthening global commercial capabilities and advancing our prioritization and execution discipline.

We expect to incur aggregate restructuring costs associated with this initiative of approximately $12.3 million related to severance and other employee costs.

The costs will be incurred as specific actions required as part of the initiative are identified and approved and are expected to continue through the end of 2026.

The amounts and timing of estimated restructuring costs are subject to change until finalized;

actual amounts and timing may vary materially based on various factors.

During 2025, we incurred $8.5 million of restructuring costs related to this initiative.

In the first quarter of 2026, we incurred an additional $3.8 million in restructuring related expenses, consistent with the previously announced plans.

RESULTS OF OPERATIONS

Executive Summary

Net loss for the three and nine months ended September 30, 2025 was $(5.4) million and $(514.8) million, or $(0.07) and (6.72) per diluted share, as compared to net loss of $(10.7) million and $(26.4) million, or $(0.14) and $(0.34) per diluted share for the three and nine months ended September 30, 2024.

The net loss decreased for the three months ended September 30, 2025 and increased for the nine months ended September 30, 2025, respectively, as compared to prior periods, primarily driven by quality and operational issues across both periods and the impact of the goodwill impairment of $511.4 million recorded in the second quarter of the current year.

Net loss for the three months ended March 31, 2026 was $(4.6) million, or $(0.06) per diluted share, as compared to net loss of $(25.3) million, or $(0.33) per diluted share, for the three months ended March 31, 2025.

The net loss decreased for the three months ended March 31, 2026, primarily due to the reduced impact of quality and operational issues in the current year compared to prior period.

Special Charges

Income before taxes includes the following special charges :

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Dollars in thousands 2026 2025

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Structural optimization charges 9,286 10,663

EU medical device regulation 10,554 10,578 32,179 35,109

Boston recall / Braintree transition (2)

13,957 9,933 42,397 33,676

EU medical device regulation 7,887 10,944

Total $ 26,713 $ 42,641

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The items reported above are reflected in the condensed consolidated statements of operations as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Dollars in thousands 2026 2025

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The Company’s revenues and gross margin on product revenues were as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Dollars in thousands 2026 2025

Segment Net Sales

Codman Specialty Surgical $ 292,583 $ 270,782 $ 877,204 $ 828,977

Tissue Technologies 109,479 110,052 323,116 338,904

Specialty Surgery $ 283,135 $ 280,664

Tissue Reconstruction 108,783 101,989

Total revenues $ 391,918 $ 382,653

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Gross margin as a percentage of total revenues 55.4 % 50.8 %

Three Months Ended September 30, 2025 as Compared to Three Months Ended September 30, 2024

Three Months Ended March 31, 2026 as Compared to Three Months Ended March 31, 2025

Revenues and Gross Margin

For the three months ended September 30, 2025, total revenues increased by $21.2 million to $402.1 million from $380.8 million for the same period in 2024, representing mid-single digit growth compared to the same period in the prior year.

In the CSS segment, revenues were $292.6 million which represents an increase of $21.8 million, or 8% as compared to the prior-year period.

Excluding the impact of foreign currency of $2.0 million, the increase in revenue is primarily driven by Cerebrospinal Fluid (“CSF”) Management and Dural Access and Repair shipping holds experienced in the third quarter of the prior year.

In the TT segment, revenues were $109.5 million which represents a decrease of $0.6 million, or 1% as compared to the prior-year period.

This is primarily attributable to the impact of quality and operational issues associated with Medihoney and decreases in private label revenues.

This is partially offset by growth in Integra Skin, which recovered from prior year supply issues, and Durasorb.

Gross margin was $207.0 million for the three months ended September 30, 2025, an increase of $6.8 million from $200.2 million for the same period in 2024.

Gross margin as a percentage of revenues was 51.5% for the three months ended September 30, 2025 and 52.6% for the same period in 2024.

For the three months ended September 30, 2025, and 2024 gross margins were impacted by quality and operational issues, which affected both revenue and expenses, as well as higher manufacturing costs.

For the three months ended March 31, 2026, total revenues increased by $9.3 million to $391.9 million from $382.7 million for the same period in 2025, representing low-single digit growth compared to the same period in the prior year.

In the Specialty Surgery segment, revenues were $283.1 million which represents an increase of $2.5 million, or 1% as compared to the prior-year period.

Excluding the impact of foreign currency of $4.1 million, the increase in revenue is primarily driven by Neurosurgery, offset by decreases in our Instrument and ENT business.

In the Tissue Reconstruction segment, revenues were $108.8 million which represents an increase of $6.8 million, or 7% as compared to the prior-year period.

This is primarily attributable to growth in Integra Skin, which recovered from prior year supply issues, Primatrix and Durasorb, offset by the impact of quality and operational issues associated with Medihoney.

Gross margin was $217.0 million for the three months ended March 31, 2026, an increase of $22.6 million from $194.4 million for the same period in 2025.

Gross margin as a percentage of revenues was 55.4% for the three months ended March 31, 2026 and 50.8% for the same period in 2025.

The increase in gross margin is primarily attributable to higher revenues and a reduction in costs related to the Braintree remediation.

Operating Ex penses

The following is a summary of operating expenses as a percent of total revenues:

Three Months Ended September 30,

Three Months Ended March 31,

Research and development 6.0 % 6.5 %

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Total operating expenses 52.5 % 54.9 %

Total operating expenses, which consist of research and development, selling, general and administrative, and amortization expenses, decreased by $13.2 million, or 6.3%, to $195.2 million in the three months ended September 30, 2025, compared to $208.4 million in the same period in 2024.

Total operating expenses, which consist of research and development, selling, general and administrative, and amortization expenses, decreased by $4.4 million, or 2.1%, to $205.5 million in the three months ended March 31, 2026, compared to $209.9 million in the same period in 2025.

Research and Development

Research and development expenses for the three months ended September 30, 2025 decreased by $5.0 million as compared to the same period in the prior year, primarily attributable to cost management initiatives that resulted in lower spend on research and development projects.

Research and development expenses for the three months ended March 31, 2026 decreased by $1.2 million as compared to the same period in the prior year, primarily attributable to cost management initiatives in the current year.

Selling, General and Administrative

Selling, general and administrative costs for the three months ended September 30, 2025 decreased by $8.1 million as compared to the same period in the prior year, primarily driven by cost management initiatives in the current year and Acclarent acquisition costs incurred in prior year.

Selling, general and administrative costs for the three months ended March 31, 2026 decreased by $3.3 million as compared to the same period in the prior year, primarily due a reduction in Acclarent integration costs and reduced spending in EU MDR.

Intangible Asset Amortization

Amortization expense (which does not include amounts reported in cost of product revenues for technology-based intangible assets) for the three months ended September 30, 2025 was $3.7 million compared to $3.8 million for the same period in the prior year.

Amortization expense (which does not include amounts reported in cost of product revenues for technology-based intangible assets) for the three months ended March 31, 2026 was $3.8 million compared to $3.7 million for the same period in the prior year.

Non-Operating Income and Expenses

The following is a summary of non-operating income and expense:

Three Months Ended September 30,

Three Months Ended March 31,

Dollars in thousands 2026 2025

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Interest Income

Interest income for the three months ended September 30, 2025 decreased by $0.1 million as compared to the same period in the prior year .

Interest income for the three months ended March 31, 2026 decreased by $0.3 million as compared to the same period in the prior year.

Interest Expense

Interest expense for the three months ended September 30, 2025 increased by $3.4 million as compared to the same period in the prior year primarily due to higher interest rates on the borrowings under the revolving credit facility component of the Senior Credit Facility as compared to the interest rates on the 2025 Notes.

Other Expense, net

Other expense, net for the three months ended September 30, 2025 increased by $3.0 million compared to the same period in the prior year, primarily driven by foreign exchange impact.

Three Months Ended September 30,

Interest expense for the three months ended March 31, 2026 increased by $3.7 million as compared to the same period in the prior year primarily due to higher interest rates on the borrowings under the revolving credit facility component of the Senior Credit Facility as compared to the interest rates on the 2025 Notes, which was repaid in August 2025.

Other Income (Expense), net

Other income (expense), net for the three months ended March 31, 2026 changed by $4.6 million as compared to the same period in the prior year, primarily driven by higher income recognized on our cross currency swap contracts.

Three Months Ended March 31,

Dollars in thousands 2026 2025

Loss before income taxes $ (2,409) $ (30,036)

Benefit provision for income taxes (1,420) (9,667)

Provision (benefit) for income taxes 2,208 (4,743)

Effective tax rate (91.7) % 15.8 %

The Company’s effective income tax rates for the three months ended September 30, 2025 and 2024 were 20.8% and 47.5%, respectively.

For the three months ended September 30, 2025, the Company’s effective tax rate was primarily driven by the tax expense generated in certain profitable foreign jurisdictions and the inclusion of Global Intangible Low Taxed Income (“GILTI”);

offset by federal, state, and international tax benefits generated from operating losses and favorable prior year tax return positions.

For the three months ended September 30, 2024, the tax rate is primarily due to the limitation of foreign tax credits in the U.S.

and the limitation of federal tax credits in Switzerland, caused by lower book income.

The Company’s effective income tax rates for the three months ended March 31, 2026 and 2025 were (91.7)% and 15.8%, respectively.

For the three months ended March 31, 2026, the Company’s effective tax rate was primarily driven by a $2.9 million tax expense related to a shortfall from stock-based compensation, due to market conditions.

For the three months ended March 31, 2025, the Company’s effective tax rate was driven by federal, state, and international tax benefits generated from operating losses in certain jurisdictions, offset by a $2.1 million tax expense related to a shortfall from stock-based compensation.

The effective tax rate may vary from period to period depending on, among other factors, the geographic and business mix of taxable earnings and losses, tax planning and settlements with various taxing authorities.

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and non-U.S., are increasingly focused on tax reform and revenue-raising legislation.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S.

The OBBBA includes a number of significant provisions, including the permanent extension of certain expiring provisions of the 2017 Tax Cuts and Jobs Act;

as well as changes to the capitalization of research and development expenses, accelerated depreciation, and limitations on interest expense deductions.

Further legislation in foreign jurisdictions may be enacted, in continued response to the base erosion and profit-sharing project led by the Organization for Economic Cooperation and Development (“OECD”).

The OECD released model rules related to a new 15% global minimum tax regime (“Pillar 2”).

Several of the jurisdictions in which we operate have already adopted some form of the model rules, which could impact the amount of taxes that the Company pays during 2025 and future taxable periods.

The rules are complex and provide for delays for implementing the tax during the early transition years, if certain conditions are met.

At this time, the Company is projecting an immaterial Pillar 2 tax liability for the 2025 year.

The Company will continue to analyze the new Pillar 2 laws and any related guidance to determine potential impacts.

Such changes in U.S.

jurisdictions could have an adverse effect on the Company’s effective tax rate.

The Company will continue to monitor legislative activity across its U.S.

jurisdictions.

While it is often difficult to predict the outcome or the timing of the resolution of a particular matter with the various federal, state, and foreign tax authorities, we believe that our reserves reflect the most probable outcome of known tax contingencies.

Settlement of a particular issue would usually require the use of cash.

A favorable resolution would be recognized as a reduction to our annual effective tax rate in the year of resolution.

The Company’s tax reserves are presented in the balance sheet within other liabilities, except for amounts relating to items that we expect to pay in the coming year, which would be classified as current income taxes payable.

Nine Months Ended September 30, 2025 as Compared to Nine Months Ended September 30, 2024

Revenues and Gross Margin

For the nine months ended September 30, 2025, total revenues increased by $32.4 million to $1,200.3 million from $1,167.9 million for the same period in 2024.

This represents low single digit growth compared to the same period in the prior year, primarily driven by sales related to Acclarent, as well as impacts from quality and operational issues in both periods.

In the CSS segment, revenues were $877.2 million, an increase of $48.2 million, or 6% from the prior year period.

Excluding the impact of foreign currency of $3.1 million, the increase is primarily due to the timing of the Acclarent acquisition completed in the second quarter in the prior year and CSF Management and Dural Access and Repair shipping holds experienced in the prior year.

In the TT segment, revenues were $323.1 million, a decrease of $15.8 million, or 5% from the prior year period, primarily attributable to the impact of quality and operational issues associated with Medihoney and decreases in private label revenues.

This is partially offset by growth in Integra Skin, which recovered from prior year supply issues, and Durasorb.

Gross margin was $610.8 million for the nine months ended September 30, 2025, a decrease of $22.2 million from $633.0 million for the same period in 2024.

Gross margin as a percentage of total revenue decreased to 50.9% for the nine months ended September 30, 2025 from 54.2% in the same period in 2024.

For the nine months ended September 30, 2025, gross margins were impacted by quality and operational issues, which affected both revenue and expenses, as well as higher manufacturing costs.

For the nine months ended September 30, 2024 gross margins were impacted by impairment charges associated with the Boston recall, Acclarent inventory step up, and expenses associated with quality and operational issues.

Operating Expenses

The following is a summary of operating expenses as a percent of total revenues:

Nine Months Ended September 30,

Research and development 6.2 % 7.2 %

Selling, general and administrative 44.2 % 46.1 %

Intangible asset amortization 0.9 % 1.5 %

Goodwill Impairment 42.6 % — %

Total operating expenses 93.9 % 54.8 %

Total operating expenses, which consist of selling, general and administrative expenses, research and development expenses, and amortization expenses, increased by $487.0 million, or 76.1% to $1,127.2 million in the nine months ended September 30, 2025, compared to $640.2 million in the same period in 2024, primarily driven by goodwill impairment recorded in the second quarter of 2025.

Research and Development

Research and development expenses for the nine months ended September 30, 2025 decreased by $10.0 million as compared to the same period, primarily attributable to lower spend on EU MDR and cost management initiatives that resulted in lower spend on other research and development projects.

Selling, General and Administrative

Selling, general and administrative costs decreased by $8.0 million as compared to the same period in the prior year, primarily driven by Acclarent acquisition costs incurred in prior year, and cost management initiatives in the current year.

Intangible Asset Amortization

Amortization expense (excluding amounts reported in cost of product revenues for technology-based intangible assets) for the nine months ended September 30, 2025 was $11.2 million compared to $17.6 million for the same period in the prior year.

The decrease is driven by the impairment of customer relationship intangible related to our Boston facility of $7.1 million, which was recorded in the first quarter of 2024.

We expect total annual amortization expense to be approximately $26.9 million for the remainder of 2025, $107.6 million in 2026, $106.5 million in 2027, $103.0 million in 2028, $97.7 million in 2029, $91.6 million in 2030 and $447.6 million thereafter.

Non-Operating Income and Expenses

The following is a summary of non-operating income and expenses:

Nine Months Ended September 30,

Dollars in thousands 2025 2024

Interest income $ 14,112 $ 15,147

Interest expense (62,582) (51,648)

Other (expense) and income, net (2,932) 2,939

Total non-operating expense $ (51,402) $ (33,562)

Interest Income

Interest income for the nine months ended September 30, 2025 increased by $1.0 million as compared to the same period in the prior year due to increased investments.

Interest Expense

Interes t expense for the nine months ended September 30, 2025 increased by $10.9 million as compared to the same period in the prior year primarily due to the impacts of interest rate swaps that have expired and are no longer hedging interest expense in 2025, as well as higher interest rates on the borrowings under the revolving credit facility component of the Senior Credit Facility as compared to the interest rates on the 2025 Notes.

Other (Expense) and Income, net

Other (expense) and income, net for the nine months ended September 30, 2025, decreased by $5.9 million as compared to the same period in the prior year, primarily driven by foreign exchange impact.

Nine Months Ended September 30,

Dollars in thousands 2025 2024

Income before income taxes $ (567,812) $ (40,778)

Income tax (benefit) expense (53,042) (14,399)

Effective tax rate 9.3 % 35.3 %

The Company’s effective income tax rates for the nine months ended September 30, 2025 and 2024 were 9.3% and 35.3%, respectively.

For the nine months ended September 30, 2025, the Company’s effective tax rate was primarily driven by the goodwill impairment charge, as a portion of the charge is non-deductible for tax, as well as the inclusion of GILTI and the global minimum tax in certain foreign jurisdictions;

offset by federal, state, and international tax benefits generated from operating losses and favorable prior year tax return positions.

For the nine months ended September 30, 2024, the tax rate is primarily due to the limitation of foreign tax credits in the U.S.

and the limitation of federal tax credits in Switzerland, caused by lower booked income and a $1.9 million shortfall from stock-based compensation.

On July 4, 2025 the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S., with certain provisions effective in 2025 and others implemented through 2027.

The OBBBA included the permanent extension of certain expiring provisions of the 2017 Tax Cuts and Jobs Act, the immediate expensing of previously capitalized research and development costs, and reduced limitations on interest expense deductions, among other provisions.

Further, the Company continues to monitor legislation in foreign jurisdictions, enacted in response to ongoing efforts led by the Organization of Economic Cooperation and Development (“OECD”).

The OECD released Pillar Two model rules, defining a new 15% global minimum tax for each jurisdiction in which a multinational corporation operates, effective beginning in 2024.

GEOGRAPHIC PRODUCT REVENUES AND OPERATIONS

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Total revenue by major geographic area consisted of the following:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Dollars in thousands 2026 2025

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Local economic conditions, regulatory compliance or political considerations, the effectiveness of our sales representatives and distributors, local competition and changes in local medical practice all may combine to affect our sales into markets outside the U.S.

The increase in domestic and international revenues for the three months ended September 30, 2025 was primarily related to CSF Management and Dural Access and Repair shipping holds experienced in the third quarter of the prior year.

The increase in domestic and international revenues for the nine months ended September 30, 2025 was primarily related to the timing of Acclarent acquisition and CSF Management and Dural Access and Repair shipping holds experienced in the prior year.

LIQUIDITY AND CAPITAL RESOURCES

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Working capital consists of total current assets less total current liabilities as presented in the consolidated balance sheets.

The Company’s working capital as of September 30, 2025 and December 31, 2024 was $779.5 million and $159.6 million, respectively.

The increase in working capital is driven by the repayment of the 2025 Notes, which decreased current liabilities.

The Company’s working capital as of March 31, 2026 and December 31, 2025 was $825.2 million and $703.6 million, respectively.

The increase in working capital is driven by the 2026 amendment of our Securitization Facility, which resulted in the reclassification of borrowings from current liabilities to long term liabilities.

Cash and Marketable Securities

The Company had cash and cash equivalents totaling approximately $232.2 million and $246.4 million at September 30, 2025 and December 31, 2024, respectively, which are valued based on Level 1 measurements in the fair value hierarchy .

At September 30, 2025, our non-U.S.

The Company had cash and cash equivalents totaling approximately $236.8 million and $235.0 million at March 31, 2026 and December 31, 2025, respectively, which are valued based on Level 1 measurements in the fair value hierarchy .

At March 31, 2026, our non-U.S.

subsidiaries held approximately $196.9 million of cash and cash equivalents that are available for use outside the U.S.

1 unchanged sentence

Short-Term Investments

The Company had short-term investments, primarily consisting of time deposits, which are valued based on Level 1 measurements in the fair value hierarchy, totaling approximately $35.7 million at September 30, 2025 compared to $27.2 million at December 31, 2024.

Nine Months Ended September 30,

The Company had short-term investments, primarily consisting of time deposits, which are valued based on Level 1 measurements in the fair value hierarchy, totaling approximately $28.7 million at March 31, 2026 and December 31, 2025.

Three Months Ended March 31,

Dollars in thousands 2026 2025

Net cash (used in) provided by operating activities $ 38,568 $ 78,642

Net cash provided by (used in) operating activities $ 9,803 $ (11,257)

Net cash used in investing activities (14,848) (35,920)

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Cash Flows Provided by or Used in Operating Activities

Operating cash flows for the nine months ended September 30, 2025 decreased by $40.1 million compared to the same period in 2024.

Within operating cash flows, net income less non-cash adjustments decreased for the nine months ended September 30, 2025 by approximately $40.7 million as compared to the same period in 2024 due to the impact of quality and operational issues on revenue and associated costs.

The changes in assets and liabilities for the nine months ended September 30, 2025, net of business acquisitions, decreased cash flows by $18.4 million, mainly attributable to increases in inventory.

The changes in assets and liabilities for the nine months ended September 30, 2024, net of business acquisitions, decreased cash flows by $19.0 million, mainly attributable to increases in prepaid and other current assets, and inventory, offset by decreases in accounts receivable.

Operating cash flows for the three months ended March 31, 2026 increased by $21.1 million compared to the same period in 2025.

Within operating cash flows, net income less non-cash adjustments increased for the three months ended March 31, 2026 by approximately $27.0 million, primarily due to the reduced impact of quality and operational issues in the current year compared to the prior period.

The changes in assets and liabilities for the three months ended March 31, 2026, net of business acquisitions, decreased cash flows by $30.6 million, mainly attributable to a decrease in accrued expenses and other current liabilities due to payment of employee bonuses and an increase in inventory which increased cash outflows.

This is partially offset by improved customer collections.

The changes in assets and liabilities for the three months ended March 31, 2025, net of business acquisitions, decreased cash flows by $24.7 million, mainly attributable to decreases in accrued expenses and other current liabilities due to payment of employee bonuses.

Cash Flows Used in Investing Activities

Uses of cash from investing activities for the nine months ended September 30, 2025 were $64.2 million paid for capital expenditures to support improvement initiatives at a number of our manufacturing facilities and other technology investments, $8.5 million related to short-term investments, and $0.4 million related to the settlement of our net investment hedges.

There were no sources of cash from investing activities for the nine months ended September 30, 2025.

Uses of cash from investing activities during the nine months ended September 30, 2024 were $74.8 million paid for capital expenditures to support the investment in the new Braintree facility, as well as improvement initiatives at a number of our manufacturing facilities, and other technology investments, $282.0 million related to the Acclarent acquisition, and $49.0 million related to short-term investments.

Sources of cash from investing activities during the nine months ended September 30, 2024 were $19.3 million for short-term investments converted to cash.

Uses of cash from investing activities for the three months ended March 31, 2026 were $14.8 million paid for capital expenditures to support improvement initiatives at a number of our manufacturing facilities and other technology investments.

There were no sources of cash from investing activities for the three months ended March 31, 2026.

Uses of cash from investing activities during the three months ended March 31, 2025 were $28.9 million paid for capital expenditures to support improvement initiatives at a number of our manufacturing facilities, and other technology investments, as well as $7.0 million related to short-term investments.

There were no sources of cash from investing activities for the three months ended March 31, 2025.

Cash Flows Provided by Financing Activities

Uses of cash from financing activities in the nine months ended September 30, 2025 related to the repayments of the 2025 Notes of $575.0 million, as well as $69.8 million of repayments under our Senior Credit Facility and Securitization Facility.

In addition, the company paid $16.5 million related to payments of Arkis and SIA contingent consideration, $3.9 million in debt issuance costs and $2.6 million in cash taxes for net equity settlements.

Sources of cash from financing activities for the nine months ended September 30, 2025 were $671.0 million of proceeds from borrowings of long term indebtedness and $1.0 million related to the proceeds from employee stock purchases.

Uses of cash from financing activities in the nine months ended September 30, 2024 related to the repayments of $147.2 million under our Senior Credit Facility and Securitization Facility, $50.0 million related to the repurchase of treasury stock of under the share repurchase agreements, and $11.9 million related to payment of SIA contingent consideration.

Uses of cash from financing activities in the three months ended March 31, 2026 related to the repayments of $35.6 million under our Senior Credit Facility and Securitization Facility.

In addition, the company paid $1.4 million in cash taxes for net equity settlements.

Sources of cash from financing activities for the three months ended March 31, 2026 were $44.5 million of proceeds from borrowings of long term indebtedness and $0.8 million related to the proceeds from employee stock purchases.

Uses of cash from financing activities in the three months ended March 31, 2025 related to the repayments of $15.2 million under our Senior Credit Facility and Securitization Facility, as well as $2.6 million related to payment of contingent consideration in connection with our acquisition of Arkis.

In addition, the Company had $2.1 million in cash taxes paid for net equity settlements.

Sources of cash from financing activities for the nine months ended September 30, 2024 were $451.1 million of proceeds from borrowings of long-term indebtedness and $6.4 million related to the proceeds from the exercise of stock options.

Sources of cash from financing activities for the three months ended March 31, 2025 were $54.4 million of proceeds from borrowings of long-term indebtedness and $1.0 million related to the proceeds from the exercise of stock options.

Tariffs and Macroeconomic Environment

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tariffs that have been implemented.

administration has appealed this ruling and the U.S.

Supreme Court has agreed to hear the case, with oral arguments anticipated in November 2025.

In September 2025, the U.S.

Department of Commerce initiated national security investigations into medical equipment, devices, and robotics.

The tariff environment has continued to shift throughout the 2025 calendar year, with new measures being proposed, paused, implemented, and countered, contributing to broader trade policy uncertainty.

Tariffs could result in an increase in certain product costs or have adverse impacts on, among other things, demand for our products and supply chains.

administration has appealed this ruling.

In February 2026, the U.S.

Supreme Court ruled to invalidate the U.S.

administration’s tariff program implemented under the International Emergency Economic Powers Act (“IEEPA”), concluding that IEEPA did not authorize the broad import duties previously imposed.

The ruling did not address the treatment of previously collected tariff payments, leaving refund processes subject to future administrative and judicial determinations.

Following the ruling, the U.S.

administration announced a new global 10% tariff under Section 122 of the Trade Act of 1974, which permits temporary import surcharges of up to 15% for up to 150 days to address balance of payments deficits, with implementation effective almost immediately and subject to certain exemptions.

Subsequent to the U.S.

Supreme Court ’ s decision, the U.S.

Court of International Trade issued an order directing U.S.

Customs and Border Protection (“CBP”) to establish an administrative process to issue refunds of any IEEPA tariffs imposed without appropriate authority.

On April 20, 2026, the CBP launched an online portal referred to as the Consolidated Administration and Processing of Entries (“CAPE”) that can be used to submit IEEPA tariff refund requests.

All requests will be reviewed by the CBP to determine validity prior to the issuance of refunds.

Any tariffs paid have been capitalized in inventory and have been recognized in cost of goods sold as those products subject to tariffs have been sold.

During the three months ended March 31, 2026, the Company applied the guidance within FASB Topic 405-20, Liabilities - Extinguishments of Liabilities (“ASC 405-20”).

As a result, the Company recognized a receivable of $18.7 million, recorded within other current assets, for tariffs previously paid on imported goods that are subject to refund.

Of this amount $3.4 million had been previously expensed in 2025 to cost of goods sold, and $15.3 million would have been expensed in the current year.

These adjustments relate to the legal right to receive a refund of IEEPA tariffs previously imposed on the Company without appropriate authority.

Tariffs have resulted in an increase in certain product costs and could have adverse impacts on, among other things, demand for our products and supply chains.

Particularly, the U.S.

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The Company anticipates that some of its suppliers will incur incremental tariff-related costs, which may be passed on to the Company.

Approximately half of our global revenue is generated from products manufactured in the United States.

Approximately half of our global revenue is generated from products manufactured in the U.S.

In China, which accounts for approximately 5 percent of our total revenue, roughly half of the products we sell are manufactured in the United States.

Any tariffs paid have been capitalized in inventory and will be recognized in our cost of goods sold as those products are sold.

During the three and nine months ended September 30, 2025, the Company paid approximately $6.7 million and $12.1 million, respectively of tariffs on imported goods.

Of this amount, $1.6 million and $2.6 million, respectively, was recognized in cost of goods sold in the consolidated statements of operations.

Additionally, in September 2025, the U.S.

Department of Commerce initiated national security investigations into medical equipment, devices, and robotics.

The tariff environment has continued to shift, with new measures being proposed, paused, implemented, and countered, contributing to broader trade policy uncertainty.

The overall macroeconomic and geopolitical environment, including tariffs or changes in trade policies, slower economic growth or recession, market volatility and inflation, and uncertainty regarding all of the foregoing, pose risks that could impact our business, results of operations, financial condition and cash flows.

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and affected countries, the responses of other countries or regions, exemptions or exclusions that already exist or may be granted, availability and cost of alternative sources of our products and materials, and our ability to offset the effects of any tariffs that might be imposed.

For additional information on the risks that tariffs pose to the Company, please see Part II, Item 1A.

“Risk Factors” of this Quarterly Report on Form 10-Q and of the Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 and Part I, Item 1A.

For additional information on the risks that tariffs pose to the Company, please see Part I, Item 1A.

“Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

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Derivative Instruments , to the Notes to Unaudited Condensed Consolidated Financial Statements (Part I, Item 1 of this Quarterly Report) for discussion of our hedging activities.

The Senior Credit Facility is subject to various financial and negative covenants and, at September 30, 2025, the Company was in compliance with all such covenants.

Our Consolidated Total Leverage Ratio was 4.35, with the covenant requirement at 5.00 at the end of September 30, 2025.

The Senior Credit Facility is subject to various financial and negative covenants and, at March 31, 2026, the Company was in compliance with all such covenants.

Our Consolidated Total Leverage Ratio was 4.12, with the covenant requirement at 5.00 at the end of March 31, 2026.

As outlined in the table in Note 6.

Debt, the covenant requirement will drop from 5.00 to 4.75 for the fiscal quarter ended September 30, 2026.

The 2025 Notes matured on August 15, 2025 and were settled upon maturity for $575.0 million in cash, excluding accrued interest, funded by borrowings on the revolving credit facility component of the Senior Credit Facility.

No shares were issued to settle the 2025 Notes.

Share Repurchase Plan

Treasury Stock , to the Notes to Unaudited Condensed Consolidated Financial Statements (Part I, Item 1 of this Quarterly Report) for further details of our share repurchase programs.

Dividend Policy

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Off-Balance Sheet Arrangements

We do not have any off-balance sheet financing arrangements during the nine months ended September 30, 2025 that have or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our interests.

We do not have any off-balance sheet financing arrangements during the three months ended March 31, 2026 that have or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our interests.

Contractual Obligations and Commitments

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The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of revenues and expenses.

The critical accounting estimates discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 did not materially change in the nine months ended September 30, 2025.

The critical accounting estimates discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 did not materially change in the three months ended March 31, 2026.

Recently Issued Accounting Standards

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis