Adjusted EBITDA was negative $83 million in Q2 2025 versus negative $3 million in Q2 2024, reflecting risk adjustment and Part D cost impacts partially offset by cost initiatives.
Medical cost trends were around 6% in the first half of 2025, consistent with prior expectations.
Medical margin was negative $53 million in Q2 2025 compared to positive $106 million in Q2 2024, driven by underperformance in burden of illness programs and prior period adjustments.
Medicare Advantage membership declined to 498,000 from 513,000 year-over-year, reflecting a measured growth approach and market exits.
Q2 2025 revenue was $1.4 billion, down from $1.48 billion in Q2 2024, primarily due to lower risk adjustment and unfavorable Part D development.
Adjusted gross margin was 56.5%, 120 basis points higher than prior year quarter.
Adjusted net income was $35.6 million, up 16.4% year-over-year; adjusted diluted EPS was $1.15, up 17.3%.
Cash balance was $33.9 million; accounts receivable days stable at 62; inventory days decreased by 10 to 212.
Cash flow from operations was $29.1 million, down from $43.3 million in prior year; capital expenditures increased to $5.7 million.
GAAP net income was $21.4 million compared to $30.0 million in 2024; GAAP EPS was $0.69 versus $0.96 a year ago.
General surgery sales grew 4.4% worldwide; orthopedic sales grew 0.8% worldwide.
Long-term debt decreased to $881.1 million; leverage ratio improved to 3.1x.
R&D expense was 4.1% of sales, slightly lower than prior year; adjusted SG&A was 37.1% of sales, slightly higher.
Total sales for Q2 were $342.3 million, slightly above the high end of guidance, with 3.1% year-over-year growth as reported and 2.9% in constant currency.
Clinical Diagnostics sales were $389 million, flat reported and down 0.7% currency-neutral, impacted by lower diabetes testing reimbursement in China.
Core Life Science Group revenue excluding process chromatography decreased 1.7% reported and 2.7% currency-neutral due to softness in biotech and academic research markets.
Gross margin declined to 53% reported and 53.7% non-GAAP from 55.6% and 56.4% respectively in Q2 2024, due to higher material costs and lower instrument demand.
Life Sciences Group sales were $263 million, up 4.9% reported and 3.8% currency-neutral, driven by process chromatography and food safety products.
Net cash from operations was $117 million, free cash flow was $71 million, up from $98 million and $55 million respectively in Q2 2024.
Net sales for Q2 2025 were approximately $652 million, a 2.1% increase on a reported basis versus $638 million in Q2 2024, and a 1% increase on a currency-neutral basis.
Non-GAAP net income was $71 million or $2.61 per diluted share.
Operating income was $77 million (11.8% of sales) versus $101 million (15.9%) in Q2 2024; non-GAAP operating margin was 13.6% versus 16.7%.
Process chromatography experienced strong double-digit growth, with about 20% of Q2 sales pulled forward by customers.
R&D expenses were $61 million (9.3% of sales), slightly higher than prior year due to project-related spending.
Reported net income was $318 million or $11.67 per diluted share, boosted by a $250 million gain from Sartorius AG equity value changes.
SG&A expenses increased to $208 million (31.9% of sales) from $195 million (30.5%), driven by higher variable compensation.
Share repurchases totaled $139 million in Q2, with $337 million remaining under the current authorization.
Dafinchi