v3.25.3
Segment Information
 9 Months Ended
Oct. 03, 2025
Segment Reporting [Abstract]  
Segment Information Segment Information
The Company conducts its continuing operations through the Prevention & Recovery and Reconstructive operating segments, which also represent the Company’s reportable segments.

▪P&R - a leader in orthopedic solutions and recovery sciences, providing devices, software, and services across the patient care continuum from injury prevention to rehabilitation after surgery, injury, or from degenerative disease.

•Recon - an innovation market-leader positioned in the fast-growing surgical implant business, offering a comprehensive suite of reconstructive joint products for the hip, knee, shoulder, elbow, foot, ankle, and finger, and surgical productivity tools.

The Company’s management, including the chief operating decision maker, evaluates the operating results of each of its reportable segments based upon Net sales and Adjusted EBITDA, which excludes the effect of Other (income) expense, net, non-operating (gain) loss on investments, debt extinguishment charges, interest expense, net, restructuring charges, Medical Device Regulation (MDR) and other costs, strategic transaction costs, stock-based compensation, depreciation and other amortization, acquisition-related intangible asset amortization, purchase of royalty interest, goodwill impairment charges, and inventory step-up charges from the results of the Company’s operating segments.

The Company’s segment results were as follows:
Three Months EndedNine Months Ended
October 3, 2025September 27, 2024October 3, 2025September 27, 2024
(In thousands)
Prevention & Recovery:
Net sales$290,939 $274,244 $854,093 $811,011 
Segment cost of sales135,099 130,801 395,199 389,709 
Segment research and development9,641 9,088 28,551 27,111 
Segment operating expense108,937 96,148 324,304 295,975 
Total segment expenses253,677 236,037 748,054 712,795 
Add: Depreciation5,038 4,569 13,895 13,624 
Adjusted EBITDA (non-GAAP)$42,300 $42,776 $119,934 $111,840 
Reconstructive:
Net sales$257,973 $230,978 $818,198 $735,637 
Segment cost of sales82,855 77,224 259,760 243,619 
Segment research and development20,098 11,403 60,416 40,236 
Segment operating expense128,263 118,167 401,871 372,087 
Total segment expenses231,216 206,794 722,047 655,942 
Add: Depreciation25,711 23,243 75,007 72,116 
Adjusted EBITDA (non-GAAP)$52,468 $47,427 $171,158 $151,811 
Total:
Net Sales$548,912 $505,222 $1,672,291 $1,546,648 
Adjusted EBITDA (non-GAAP) $94,768 $90,203 $291,092 $263,651 
The following is a reconciliation of Net Loss to Adjusted EBITDA:
Three Months EndedNine Months Ended
October 3, 2025September 27, 2024October 3, 2025September 27, 2024
(In thousands)
Net Loss (GAAP)$(570,913)$(31,262)$(663,166)$(121,615)
Loss (income) from discontinued operations, net of taxes40 (2,243)258 (2,175)
Income tax expense (benefit)4,005 (9,096)13,037 (25,408)
Restructuring charges (1)
3,376 7,786 8,204 25,284 
MDR and other costs (2)
2,426 5,297 8,985 14,757 
Strategic transaction costs (3)
15,675 21,428 41,180 64,958 
Stock-based compensation 8,957 7,827 25,032 21,868 
Depreciation and other amortization 30,691 28,440 88,902 85,740 
Amortization of acquired intangibles 43,689 42,786 128,463 124,653 
Goodwill impairment charge 548,442 — 548,442 — 
Purchase of royalty interest— — 45,818 — 
Inventory step-up — 8,376 18,119 37,361 
Interest expense, net 8,828 11,066 27,310 48,031 
Other (income) expense, net (4)
(448)(202)508 (9,803)
Adjusted EBITDA (non-GAAP) $94,768 $90,203 $291,092 $263,651 
(1) Restructuring charges include $1.5 million and $1.7 million expense classified as Cost of sales on the Company’s Condensed Consolidated Statements of Operations for the three and nine months ended October 3, 2025, respectively. Restructuring charges include $2.7 million expense classified as Cost of sales on the Company’s Condensed Consolidated Statements of Operations for the three and nine months ended September 27, 2024, respectively.
(2) MDR and other costs includes (i) $2.1 million and $7.6 million for the three and nine months ended October 3, 2025 and $3.5 million and $12.3 million for the three and nine months ended September 27, 2024, respectively, in non-recurring costs specific to updating our quality system, product labeling, asset write-offs and product remanufacturing to comply with the medical device reporting regulations and other requirements of the new medical device regulations in the European Union for devices which were introduced to the market prior to the regulation and (ii) $0.4 million and $1.4 million for the three and nine months ended October 3, 2025 and $1.8 million and $2.4 million for the three and nine months ended September 27, 2024, respectively, of expenses to resolve certain infrequent, non-recurring regulatory or other legal matters. These costs are classified as Selling, general and administrative expense on our Condensed Consolidated Statements of Operations.
(3) Strategic transaction costs includes: (i) $9.2 million and $28.1 million for the three and nine months ended October 3, 2025 and $17.5 million and $55.1 million for the three and nine months ended September 27, 2024, respectively, related to non-recurring integration costs associated with the Lima Acquisition, which includes payroll and retention costs for roles to be eliminated or that are dedicated to integration activities, professional and consulting fees specifically incurred to consummate the acquisition and advise and facilitate on post-acquisition integration matters including legal entity consolidation, costs associated with rebranding and marketing acquired business under Enovis name, such as marketing materials, trade show redesign costs and product labeling, and integration related costs associated with sales agent and distributor network rationalization, including contract termination and retention expenses, supply chain and portfolio integration, and quality management system consolidation, (ii) $6.1 million and $11.8 million for the three and nine months ended October 3, 2025 and $2.6 million and $5.7 million for the three and nine months ended September 27, 2024, respectively, of non-recurring (non-Lima) acquisition integration costs and other non-recurring project costs for global ERP rationalization and shared service center start-up, and (iii) $0.4 million and $1.3 million for the three and nine months ended October 3, 2025 and $1.3 million and $4.2 million for the three and nine months ended September 27, 2024, respectively, related to the Separation of our former fabrication technology business. These costs are classified as Selling, general and administrative expense on our Condensed Consolidated Statements of Operations.
(4) Includes the final fair value loss adjustment for the Contingent Acquisition Shares in 2025, and the fair value gain on Contingent Acquisition Shares in 2024, partially offset by a loss on the non-designated forward currency hedge for managing exchange rate risk related to the Euro-denominated purchase price of the Lima Acquisition.
The Company’s total assets and capital expenditures by segment were as follows:

October 3, 2025December 31, 2024
(In thousands)
Total assets(1):
Prevention & Recovery$1,770,081 $1,955,138 
Reconstructive2,663,286 2,763,639 
Total$4,433,367 $4,718,777 
(1) Includes allocation of certain centrally managed assets, including cash and cash equivalents.


Three Months EndedNine Months Ended
October 3, 2025September 27, 2024October 3, 2025September 27, 2024
(In thousands)
Capital expenditures:
Prevention & Recovery$6,860 $11,028 $21,195 $20,596 
Reconstructive46,631 40,161 119,927 106,926 
Total capital expenditures$53,491 $51,189 $141,122 $127,522