Organogenesis Holdings Inc. reported fourth‑quarter 2025 results that included record net product revenue of $225.1 million, a 78% year‑over‑year increase, and earnings per share of $0.24, beating the consensus estimate of $0.22 by $0.02 (9.1%). Gross profit rose to $175.2 million, or 78% of revenue, up from $95.6 million (75%) a year earlier, and operating income surged to $63.3 million, a 519% jump from $10.2 million in Q4 2024. The company’s margin expansion reflects a shift toward higher‑margin Advanced Wound Care products and disciplined cost management.
Advanced Wound Care sales grew 83% year‑over‑year to $531.2 million, while Surgical & Sports Medicine revenue fell 2% to $31.8 million. Sequentially, net product revenue was up 50% from the prior quarter, driven almost entirely by the Advanced Wound Care segment. The mix shift toward the higher‑margin wound‑care line helped lift gross profit margin from 75% to 78% and contributed to the sharp rise in operating income.
Management cautioned that the company’s 2026 revenue guidance has been lowered to a range of $350 million to $420 million, a 25%‑38% decline from the 2025 revenue of $563 million. The guidance cut reflects anticipated impacts from recent Centers for Medicare & Medicaid Services policy changes that have withdrawn key coverage determinations for skin substitutes, increasing competition and creating clinician confusion. The company expects the first half of 2026 to be affected by these regulatory shifts, but it projects a rebound in the second half as it expands into new markets through its ReNu program and continues to invest in manufacturing and R&D.
CEO Gary S. Gillheeney said the company delivered record sales that exceeded the high end of the guidance range set in the third‑quarter call, attributing the growth to the 83% increase in Advanced Wound Care sales. CFO David C. Francisco noted that Q4 revenue was up 78% year‑over‑year and 50% sequentially, and that the results were above the high end of expectations set in the third‑quarter call. Both executives emphasized that the company remains confident in its long‑term strategy, expecting to return to normalized growth in 2027 after the 2026 transition.
Investors reacted negatively to the guidance, citing the steep revenue decline forecast as the primary driver of the market’s response. Despite the strong Q4 performance, the forward outlook dampened enthusiasm, underscoring the importance of regulatory and competitive headwinds in shaping investor sentiment.
The company’s long‑term prospects hinge on its ability to navigate the CMS policy environment and capitalize on the ReNu program, which targets knee osteoarthritis pain. Continued investment in new manufacturing capacity and R&D is expected to support future growth, but the 2026 guidance signals a short‑term slowdown that will test the company’s resilience and execution capabilities.
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