ARTIVION, INC.
For the period ended Jun 30, 2026. Filed Aug 7, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 7, 2026
AORT$20.21-20.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001628280-26-032620
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-07.
0001628280-26-054746
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 99 previous paragraphs and 113 current paragraphs.
59 unchanged; 36 reworded; 16 added; 4 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 8 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
Revenues increased 11% and 14% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. The increase in revenues for the three months ended June 30, 2026 was primarily due to an increase in revenues from aortic stent grafts and On-X products, and to a lesser extent, preservation services and other products. The increase in revenues for the six months ended June 30, 2026 was primarily due to an increase in revenues from aortic stent grafts, On-X products, and preservation services, and to a lesser extent, surgical sealants and other products.
Current report
Revenues from the sales of On-X products increased 19% for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. This increase was primarily due to higher average sales prices and an increase in the volume of units sold.
Current report
Revenues from the sales of surgical sealants were flat for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, primarily due to a decrease in the volume of milliliters sold, offset by favorable foreign exchange rates and, to a lesser extent, an increase in average sales prices.
Current report
Constant currency revenues from the sales of surgical sealants decreased 2% for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The decrease for the three months ended June 30, 2026 was primarily due to revenue decreases in EMEA and North America, partially offset by revenue increases in APAC and LATAM. Revenue variability across international markets primarily reflected the timing of hospital and distributor purchases and buying patterns. North America revenues decreased due to lower unit sales primarily reflecting the timing of customer orders, partially offset by higher average selling prices.
Current report
Constant currency revenues from the sales of surgical sealants decreased 1% for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The decrease for the six months ended June 30, 2026 was primarily due to revenue decreases in LATAM and EMEA, partially offset by revenue increases in APAC and North America. Revenue variability across international markets primarily reflected the timing of hospital and distributor purchases and buying patterns, while APAC growth also benefited from increased adoption in certain markets. The revenue increase in North America for the six months ended June 30, 2026 was primarily due to an increase in average sales prices.
Current report
Revenues from tissue processing increased 1% for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was primarily due to an increase in average sales prices, partially offset by a decrease in the volume of tissues shipped. Shipment volumes during the three months ended June 30, 2025 benefited from the release of a backlog of tissues resulting from the 2024 cybersecurity incident, which started to release during the second quarter of 2025.
Current report
The increase in total cost of preservation services for the six months ended June 30, 2026 was primarily due to an increase in the volume of certain tissues shipped, partially offset by a decrease in the unit cost of certain tissues shipped, as compared to the six months ended June 30, 2025.
Current report
Gross margin increased 10% and 14% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025.
Current report
General, administrative, and marketing expenses increased 38% for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, which includes the impact of the Ascyrus contingent consideration fair value adjustment loss of $8.0 million and $2.6 million for the three months ended June 30, 2026 and 2025, respectively. The remaining general, administrative, and marketing expenses for the three months ended June 30, 2026 increased $16.8 million, primarily due to $11.7 million of Endospan acquisition transaction costs, of which $10.2 million related to transaction bonuses for Endospan employees associated with the Endospan acquisition, as well as investments in sales and marketing, and increased non-cash stock compensation expenses.
Current report
Losses on Inducement/Extinguishment of Debt
Current report
During the three and six months ended June 30, 2025 we recorded a loss on inducement of convertible debt of $2.7 million in connection with the settlement of our Convertible Senior Notes. See Part I, Item 1, Note 9 of the “Notes to Condensed Consolidated Financial Statements” for further discussion of our Convertible Senior Notes.
Current report
Other Income
Current report
In connection with the borrowing, the lender withheld a $1.1 million draw fee, resulting in net cash proceeds of $148.9 million. In addition, we reclassified $1.1 million of previously capitalized debt issuance costs from other long-term assets as a deduction from the carrying amount of the facility. Accordingly, the related debt discount and debt issuance costs totaled $2.3 million and are being amortized to interest expense over the term of the facility.
Current report
In May 2026, we borrowed $150.0 million under the New Delayed Draw Term Loan Facility in connection with our acquisition of Endospan. As of June 30, 2026, our total principal indebtedness was $370.0 million, and our anticipated interest payments related to the Term Loan Facility, Revolving Credit Facility, and New Delayed Draw Term Loan Facility were $143.7 million.
Current report
We also have contingent payment obligations of up to $200.0 million payable to the former security holders of Endospan upon the achievement of certain performance milestones related to NEXUS.
Current report
In July 2026 we made a $25.0 million contingent payment upon FDA approval of the PMA application for the AMDS. Following this payment, we may be required to pay up to an additional $75.0 million under the Ascyrus Agreement upon the achievement of specified sales milestones. See Part I, Item 1, Note 3 – “Acquisition of Ascyrus” for additional information.
Removed paragraphs (4)
Previous report
Revenues increased 18% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase in revenues for the three months ended March 31, 2026 was due to an increase in revenues from aortic stent grafts, preservation services, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products.
Previous report
Constant currency revenues from the sales of surgical sealants were flat for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, as revenue growth in North America and, to a lesser extent, APAC, was offset by a decrease in revenue in LATAM. The increase in revenues in North America for thethree months ended March 31, 2026 was primarily due to an increase in unit sales and an increase in average sales prices. The increase in revenues in APAC for thethree months ended March 31, 2026 was primarily due to an increase in unit sales. The decrease in revenues in LATAM was primarily due to a decrease in unit sales in indirect markets.
Previous report
Gross margin increased 19% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.
Previous report
Other Expense (Income), Net
Reworded paragraphs (36)
Previous wording
We reported quarterly revenues of $116.3 million for the three months ended March 31, 2026, an 18% increase from the three months ended March 31, 2025. The increase in revenues for the three months ended March 31, 2026 was due to an increase in revenues from aortic stent grafts, preservation services, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products. Constant currency revenues, as defined below, increased 12% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.
Current wording
We reported quarterly revenues of $125.8 million for the three months ended June 30, 2026, an 11% increase from the three months ended June 30, 2025. The increase in revenues for the three months ended June 30, 2026 was due to an increase in revenues from all products and preservation services other than surgical sealants, which remained relatively flat. Constant currency revenues, as defined below, increased 9% for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025.
Previous wording
See the “Results of Operations” section below for additional analysis of the three months ended March 31, 2026.
Current wording
See the “Results of Operations” section below for additional analysis of the three and six months ended June 30, 2026.
Previous wording
A detailed discussion of the changes in product revenues and preservation services revenues for the three months ended March 31, 2026 is presented below.
Current wording
A detailed discussion of the changes in product revenues and preservation services revenues for the three and six months ended June 30, 2026 is presented below.
Previous wording
Revenues from products increased 16% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase for the three months ended March 31, 2026 was due to an increase in revenues from aortic stent grafts, On-X products, and surgical sealants, partially offset by a decrease in revenues from other products. A discussion of the changes in product revenues for aortic stent grafts, On-X products, surgical sealants, and other product revenues is presented below.
Current wording
Revenues from products increased 14% and 15% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. The increase for the three months ended June 30, 2026 was primarily due to an increase in revenues from aortic stent grafts and On-X products, and to a lesser extent, other products. The increase for the six months ended June 30, 2026 was primarily due to an increase in revenues from aortic stent grafts and On-X products, and to a lesser extent, surgical sealants and other products.
Previous wording
Sales of certain products through our direct sales force and distributors across Europe and various other countries are denominated in a variety of currencies including Euros, Brazilian Reals, Polish Zlotys, British Pounds, Canadian Dollars, and Swiss Francs with a concentration denominated in Euros. Each currency is subject to exchange rate fluctuations. For thethree months ended March 31, 2026, as compared to thethree months ended March 31, 2025, the US Dollar weakened in comparison to major currencies, resulting in revenue increases when these foreign currency denominated transactions were translated into US Dollars. Future changes in these exchange rates could have a material, adverse effect on our revenues denominated in these currencies. Additionally, our sales to many distributors around the world are denominated in US Dollars, and although these sales are not directly impacted by currency exchange rates, we believe that some of our distributors may delay or reduce purchases of products in US Dollars depending on the relative price of these goods in their local currencies.
Current wording
Sales of certain products through our direct sales force and distributors across Europe and various other countries are denominated in a variety of currencies including Euros, Brazilian Reals, Polish Zlotys, British Pounds, Canadian Dollars, and Swiss Francs with a concentration denominated in Euros. Each currency is subject to exchange rate fluctuations. For the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, the US Dollar weakened in comparison to major currencies, resulting in revenue increases when these foreign currency denominated transactions were translated into US Dollars. Future changes in these exchange rates could have a material, adverse effect on our revenues denominated in these currencies. Additionally, our sales to many distributors around the world are denominated in US Dollars, and although these sales are not directly impacted by currency exchange rates, we believe that some of our distributors may delay or reduce purchases of products in US Dollars depending on the relative price of these goods in their local currencies.
Previous wording
Revenues from the sales of aortic stent grafts increased 21% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase was primarily due to an increase in the volume of higher priced units sold, the effect of foreign exchange rates, as well as an increase in average sales prices.
Current wording
Revenues from the sales of aortic stent grafts increased 16% and 19% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. These increases were primarily due to an increase in the volume of units sold, and to a lesser extent, the favorable effect of foreign exchange rates.
Previous wording
Constant currency revenues from the sales of aortic stent grafts increased 10% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Revenues for the three months ended March 31, 2026 increased primarily in North America, and Europe, the Middle East, and Africa (collectively, “EMEA”), partially offset by a decrease in Asia Pacific (“APAC”) and Latin America (“LATAM”). The revenue increase in North America for the three months ended March 31, 2026 was primarily due to an increase in sales of AMDS, reflecting increased adoption following the grant of a humanitarian device exemption (“HDE”) by the FDA in December 2024 for use of the AMDS™ Hybrid Prosthesis in acute DeBakey Type I dissections in the presence of malperfusion. The HDE allows for, subject to certain restrictions, commercial distribution of AMDS in the United States (“US”) prior to the approval of a Premarket Approval Application, which we currently anticipate receiving in 2026 allowing for full commercial distribution of AMDS in the US. The revenue increase in EMEA for the three months ended March 31, 2026 was primarily due to an increase in volume of higher priced products within the aortic stent graft product line in direct (to hospitals) markets. The decrease in revenues in APAC and LATAM for the three months ended March 31, 2026 was impacted by customer buying patterns in certain markets.
Current wording
Constant currency revenues from the sales of aortic stent grafts increased 12% and 11% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. These increases for the three and six months ended June 30, 2026 were primarily due to revenue increases in Europe, the Middle East, and Africa (collectively, “EMEA”) and North America. The revenue increases in EMEA for the three and six months ended June 30, 2026 were primarily due to an increase in volume of products sold within the aortic stent graft product line in direct (to hospitals) markets. The revenue increases in North America for the three and six months ended June 30, 2026 were primarily due to an increase in sales of AMDS, reflecting increased adoption following the grant of a humanitarian device exemption (“HDE”) by the FDA in December 2024 for use of the AMDS™ Hybrid Prosthesis in acute DeBakey Type I dissections in the presence of malperfusion. The HDE allowed for, subject to certain restrictions, commercial distribution of AMDS in the United States (“US”) prior to the approval of a Premarket Approval Application, which we received in June 2026, allowing for full commercial distribution of AMDS in the US. The revenue increases for the six months ended June 30, 2026 were partially offset by revenue decreases in Asia Pacific (“APAC”) and Latin America (“LATAM”), primarily due to customer buying patterns in certain markets.
Previous wording
For the three months ended March 31, 2026 and 2025, the substantial majority of aortic stent graft revenues were generated from geographies outside the US.
Current wording
For the three and six months ended June 30, 2026 and 2025, the substantial majority of aortic stent graft revenues were generated from geographies outside the US.
Previous wording
Revenues from the sales of On-X products increased 20% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase was primarily due to an increase in the volume of units sold and an increase in average sales prices.
Current wording
Revenues from the sales of On-X products increased 20% for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. This increase was primarily due to an increase in the volume of units sold and an increase in average sales prices.
Previous wording
Constant currency revenues from the sales of On-X products increased 17% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase in revenues for the three months ended March 31, 2026 was primarily due to growth in North America, EMEA, and APAC, reflecting gains in market share. The increase in revenues from EMEA for thethree months ended March 31, 2026 was primarily due to an increase in unit sales in direct markets.
Current wording
Constant currency revenues from the sales of On-X products increased 18% and 17% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. The increase in revenues for the three and six months ended June 30, 2026 was primarily due to growth in North America, EMEA, and APAC, reflecting gains in market share.
Previous wording
Domestic revenues from the sales of On-X products accounted for 62% and 65% of total On-X revenues for the three months ended March 31, 2026 and 2025, respectively.
Current wording
Domestic revenues from the sales of On-X products accounted for 58% and 60% of total On-X revenues for the three and six months ended June 30, 2026, respectively, as compared to 61% and 63% for the three and six months ended June 30, 2025, respectively.
Previous wording
Revenues from the sales of surgical sealants increased 4% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase was primarily due to favorable foreign exchange rates and, to a lesser extent, an increase in average sales prices.
Current wording
Revenues from the sales of surgical sealants increased 2% for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. This increase was primarily due to favorable foreign exchange rates and, to a lesser extent, an increase in average sales prices, partially offset by a decrease in the volume of milliliters sold.
Previous wording
Domestic revenues from the sales of surgical sealants accounted for 50% and 49% of total surgical sealant revenues for the three months ended March 31, 2026 and 2025, respectively.
Current wording
Domestic revenues from the sales of surgical sealants accounted for 45% and 48% of total surgical sealant revenues for the three and six months ended June 30, 2026, respectively, as compared to 48% for both the three and six months ended June 30, 2025.
Previous wording
Other revenues decreased 9% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The decrease was primarily due to a decrease in PerClot product revenues resulting from the timing of shipments.
Current wording
Other revenues increased 35% and 14% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. The increase was primarily due to an increase in PerClot product revenues resulting from an increase in volume of units sold.
Previous wording
Revenues from tissue processing increased 23% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase was primarily due to an increase in the volume of higher priced tissues shipped as well as an increase in average sales prices. Revenues for the three months ended March 31, 2025 were adversely affected by the 2024 cybersecurity incident.
Current wording
Revenues from tissue processing increased 11% for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The increase was primarily due to an increase in the volume of tissues shipped as well as an increase in average sales prices. Revenues for the three months ended March 31, 2025 were adversely affected by a backlog of tissues resulting from the 2024 cybersecurity incident. The backlog started to release during the second quarter of 2025, as discussed above.
Previous wording
Cost of products increased 18% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Cost of products for the three months ended March 31, 2026 and 2025 included costs related to aortic stent grafts, On-X products, surgical sealants, and other products.
Current wording
Cost of products increased 20% and 19% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. Cost of products for the three and six months ended June 30, 2026 and 2025 included costs related to aortic stent grafts, On-X products, surgical sealants, and other products.
Previous wording
The increase in total cost of products for the three months ended March 31, 2026 was primarily due to an increase in the unit cost of certain aortic stent grafts and On-X products shipped, and an increase in the volume of On-X products and certain aortic stent grafts shipped, as compared to the three months ended March 31, 2025.
Current wording
The increase in total cost of products for the six months ended June 30, 2026 was primarily due to an increase in the volume of On-X products and aortic stent grafts shipped, and an increase in the unit cost of certain aortic stent grafts and On-X products shipped, as compared to the six months ended June 30, 2025.
Previous wording
Cost of preservation services increased 10% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Cost of preservation services included costs for cardiac and vascular tissue preservation services.
Current wording
Cost of preservation services decreased 3% for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. Cost of preservation services increased 3% for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. Cost of preservation services included costs for cardiac and vascular tissue preservation services.
Previous wording
The increase in total cost of preservation services for the three months ended March 31, 2026 was primarily due to an increase in the volume of certain tissues shipped, as compared to the three months ended March 31, 2025.
Current wording
The decrease in total cost of preservation services for the three months ended June 30, 2026 was primarily due to a decrease in the unit cost and volume of certain tissues shipped, as compared to the three months ended June 30, 2025.
Previous wording
The increase in gross margin for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, was primarily due to a favorable mix of certain products and tissues shipped, an increase in the average sales price of certain products and tissues shipped, a favorable effect of foreign exchange rates, and an increase in volume of certain products and tissues shipped for the three months ended March 31, 2026. The increase was partially offset by unfavorable cost of certain products shipped, as compared to the three months ended March 31, 2025. Gross margin as a percentage of total revenues increased for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Gross margin as a percentage of total revenues was positively impacted by a favorable product mix and favorable pricing of certain products and tissues shipped, partially offset by unfavorable costs of certain products shipped during the three months ended March 31, 2026.
Current wording
The increase in gross margin for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, was primarily due to a favorable mix of certain products and tissues shipped, an increase in the average sales price of certain products and tissues shipped, a favorable effect of foreign exchange rates, and an increase in volume of certain products and tissues shipped for the six months ended June 30, 2026. The increase was partially offset by unfavorable cost of certain products and tissues shipped, as compared to the six months ended June 30, 2025. Gross margin as a percentage of total revenues was flat for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. Gross margin as a percentage of total revenues was impacted by unfavorable costs of certain products and certain tissues shipped, offset by favorable pricing of certain products and tissues shipped during the six months ended June 30, 2026.
Previous wording
General, administrative, and marketing expenses increased 11% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, which includes the impact of the Ascyrus contingent consideration fair value adjustment loss of $1.7 million and gain of $2.8 million for the three months ended March 31, 2026 and 2025, respectively. The remaining general, administrative, and marketing expenses for the three months ended March 31, 2026 increased $1.5 million as a result of investments in sales and marketing, as well as investments in information technology, partially offset by $1.5 million in net cyber insurance recoveries received.
Current wording
General, administrative, and marketing expenses increased 25% for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, which includes the impact of the Ascyrus contingent consideration fair value adjustment loss of $9.7 million and gain of $0.2 million for the six months ended June 30, 2026 and 2025, respectively. The remaining general, administrative, and marketing expenses for the six months ended June 30, 2026 increased $18.4 million, primarily due to $12.5 million of Endospan acquisition transaction costs, of which $10.2 million related to transaction bonuses for Endospan employees associated with the Endospan acquisition, as well as investments in sales and marketing and information technology, and increased non-cash stock compensation expenses. These increases were partially offset by $1.5 million in net cyber insurance recoveries received.
Previous wording
Research and development expenses increased 31% for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Research and development spending for the three months ended March 31, 2026 was primarily focused on clinical work to gain regulatory approvals for certain aortic stent grafts.
Current wording
Research and development expenses increased 28% and 30% for the three and six months ended June 30, 2026, respectively, as compared to the three and six months ended June 30, 2025. Research and development spending for the three and six months ended June 30, 2026 was primarily focused on clinical work to gain regulatory approvals for certain aortic stent grafts.
Previous wording
Interest expense was $5.4 million and $7.7 million for the three months ended March 31, 2026 and 2025, respectively. Interest expense for the three months ended March 31, 2026 decreased primarily due to lower variable interest rates on our credit facilities and reduced interest expense as a result of the settlement of the Convertible Senior Notes. See Part I, Item 1, Note 8 of the “Notes to Condensed Consolidated Financial Statements” for further discussion of the settlement of the Convertible Senior Notes.
Current wording
Interest expense was $7.3 million and $12.6 million for the three and six months ended June 30, 2026, respectively, as compared to $7.3 million and $14.9 million for the three and six months ended June 30, 2025, respectively. Interest expense for the six months ended June 30, 2026 decreased primarily due to lower variable interest rates on our credit facilities and reduced interest expense as a result of the settlement of the Convertible Senior Notes, partially offset by interest incurred on the New Delayed Draw Term Loan borrowed in May 2026. See Part I, Item 1, Note 9 of the “Notes to Condensed Consolidated Financial Statements” for further discussion of the settlement of the Convertible Senior Notes and the borrowing under the New Delayed Draw Term Loan.
Previous wording
Other expense (income), net was $0.3 million of expense and $3.1 million of income for the three months ended March 31, 2026 and 2025, respectively. Other expense (income), net for the three months ended March 31, 2026 primarily included a net $0.8 million loss from realized and unrealized effects of foreign currency gains and losses, partially offset by a $0.5 million gain associated with fair value adjustments to loans issued pursuant to our Endospan agreements. Other expense (income), net for the three months ended March 31, 2025 primarily included a net $2.9 million gain from realized and unrealized effects of foreign currency gains and losses and a $0.3 million gain associated with fair value adjustments to loans issued pursuant to our Endospan agreements.
Current wording
Other income was $3.6 million and $3.3 million for the three and six months ended June 30, 2026, respectively, as compared to $5.0 million and $8.0 million of income for the three and six months ended June 30, 2025, respectively. For the three months ended June 30, 2026, other income primarily included a $4.3 million gain from fair value adjustments to loans issued in connection with our acquisition of Endospan, partially offset by a net $0.7 million loss from realized and unrealized effects of foreign currency gains and losses. Other income for the six months ended June 30, 2026 primarily included a $4.8 million gain associated with fair value adjustments to loans issued in connection with our acquisition of Endospan, partially offset by a net $1.6 million loss from realized and unrealized effects of foreign currency gains and losses.
Previous wording
Our effective income tax rate was a benefit of 318% and 78% for the three months ended March 31, 2026 and 2025, respectively. The effective income tax rate for the three months ended March 31, 2026 was primarily impacted by excess tax deductions on stock-based compensation, partially offset by state income taxes, non-deductible executive compensation, and changes in our valuation allowance against net deferred tax assets.
Current wording
Our effective income tax rate was (15)% and (6)% for the three and six months ended June 30, 2026, respectively, as compared to 61% and 29% for the three and six months ended June 30, 2025, respectively. Our income tax rate varied from the US statutory rate of 21% predominately due to state income taxes, non-deductible executive compensation, changes in our valuation allowance for current period losses and changes in estimates of our expected recovery of net deferred tax assets, excess tax deductions on stock-based compensation, and foreign withholding taxes. The year-over-year changes to the effective income tax rate were largely attributable to the shift from pre-tax book income in each respective period in 2025 to pre-tax book losses in each respective period in 2026.
Previous wording
On July 4, 2025 the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We have reflected the impact of the enactment in our results for the three months ended March 31, 2026.
Current wording
On July 4, 2025 the One Big Beautiful Bill Act (“OBBBA”) was enacted in the US. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We have reflected the impact of the enactment in our results for the three and six months ended June 30, 2026.
Previous wording
Our primary uses of liquidity include the payment of operating expenses, capital expenditures, servicing of debt and the funding of acquisitions or other collaborative arrangements. Our primary sources of funding are operating cash flows and borrowings under our debt facilities. As of March 31, 2026 we had approximately $220.0 million of total principal indebtedness outstanding.
Current wording
Our primary uses of liquidity include the payment of operating expenses, capital expenditures, servicing of debt and the funding of acquisitions or other collaborative arrangements. Our primary sources of funding are operating cash flows and borrowings under our debt facilities. As of June 30, 2026 we had approximately $370.0 million of total principal indebtedness outstanding.
Previous wording
Our liquidity as of March 31, 2026 consisted of cash and cash equivalents of $55.8 million, unused commitments of $30.0 million under a revolving credit facility, and unused commitments of $150.0 million on the new delayed draw term loan facility (see “Credit Facilities” below). As of March 31, 2026 approximately 33% of our cash and cash equivalents were held in foreign jurisdictions. Our practice is to maintain sufficient liquidity through cash from operations and our revolving credit facility to mitigate the impacts of any adverse financial market conditions on our operations. We believe that cash generated from operations, together with amounts available under our Credit Facilities, as defined below, will be sufficient to meet working capital requirements and anticipated capital expenditures, and other strategic uses of cash, if any, and debt payments, if any, over the next twelve months.
Current wording
Our liquidity as of June 30, 2026 consisted of cash and cash equivalents of $77.3 million and unused commitments of $30.0 million under a revolving credit facility (see “Credit Facilities” below). As of June 30, 2026 approximately 28% of our cash and cash equivalents were held in foreign jurisdictions. Our practice is to maintain sufficient liquidity through cash from operations and our revolving credit facility to mitigate the impacts of any adverse financial market conditions on our operations. We believe that cash generated from operations, together with amounts available under our Credit Facilities, as defined below, will be sufficient to meet working capital requirements and anticipated capital expenditures, and other strategic uses of cash, if any, and debt payments, if any, over the next twelve months.
Previous wording
Our future cash requirements are expected to include interest payments under our credit facilities, expenditures for clinical trials, research and development expenditures, general working capital needs, capital expenditures, other corporate purposes, obligations pursuant to the exercise of the Endospan purchase option, and may include cash to fund other business development activities including obligations pursuant to the acquisition of Ascyrus and Endospan. These items may have a significant effect on our future cash flows during the next twelve months. Subject to the terms of our credit facilities, we may seek additional borrowing capacity or financing, pursuant to our current or any future shelf registration statement, for general corporate purposes or to fund other future cash requirements. If we undertake any further significant business development activity, we may need to finance such activities by obtaining additional debt financing or using a registration statement to sell equity securities. There can be no assurance that we will be able to obtain any additional debt or equity financing at the time needed or that such financing will be available on terms that are favorable or acceptable to us.
Current wording
Our future cash requirements are expected to include interest payments under our credit facilities, expenditures for clinical trials, research and development expenditures, general working capital needs, capital expenditures, other corporate purposes, and may include cash to fund other business development activities including obligations pursuant to the acquisition of Ascyrus and Endospan. In July 2026, following receipt of FDA approval of the premarket approval application for the AMDS, we made a contingent payment of $25.0 million under the Ascyrus Agreement. These items may have a significant effect on our future cash flows during the next twelve months. Subject to the terms of our credit facilities, we may seek additional borrowing capacity or financing, pursuant to our current or any future shelf registration statement, for general corporate purposes or to fund other future cash requirements. If we undertake any further significant business development activity, we may need to finance such activities by obtaining additional debt financing or using a registration statement to sell equity securities. There can be no assurance that we will be able to obtain any additional debt or equity financing at the time needed or that such financing will be available on terms that are favorable or acceptable to us.
Previous wording
In May 2026, in connection with our election to exercise the Endospan Option, we borrowed $150.0 million under the New Delayed Draw Term Loan Facility, of which $135.0 million will be used to fund the upfront purchase price for the acquisition of Endospan. See Part I, Item 1, Note 3– “Agreements with Endospan” for further discussion of the Endospan Option acquisition.
Current wording
In May 2026 in connection with our acquisition of Endospan, we borrowed $150.0 million under the New Delayed Draw Term Loan Facility, as further described below. The proceeds of borrowings were used in part to fund the upfront purchase price for the acquisition of Endospan. See Part I, Item 1, Note 4– “Acquisition of Endospan” for further discussion of the Endospan Acquisition.
Previous wording
The final scheduled maturity date of the Credit Facilities is January 18, 2031. There are no scheduled repayments of principal required to be made prior to the final maturity date. We have the right to prepay loans under the Credit Agreement in whole or in part at any time, subject to certain premium payment requirements. Amounts repaid in respect of loans under the Term Loan Facilities may not be reborrowed. The Credit Facilities currently bear interest at the Secured Overnight Financing Rate (“SOFR”) plus applicable margins. As of March 31, 2026 the aggregate interest rate was 8.41% and 7.16% per annum for the Term Loan Facility and Revolving Credit Facility, respectively. See Part I, Item 1, Note 8 of the “Notes to Condensed Consolidated Financial Statements” for further discussion of our new Ares Credit Agreement.
Current wording
The final scheduled maturity date of the Credit Facilities is January 18, 2031. There are no scheduled repayments of principal required to be made prior to the final maturity date. We have the right to prepay loans under the Credit Agreement in whole or in part at any time, subject to certain premium payment requirements. Amounts repaid in respect of loans under the Term Loan Facilities may not be reborrowed. The Credit Facilities currently bear interest at the Secured Overnight Financing Rate (“SOFR”) plus applicable margins. As of June 30, 2026 the stated interest rates on the Term Loan Facility, Revolving Credit Facility, and New Delayed Draw Term Loan Facility were 8.44%, 7.19%, and 8.40%, respectively. See Part I, Item 1, Note 9 of the “Notes to Condensed Consolidated Financial Statements” for further discussion of our new Ares Credit Agreement.
Previous wording
Net cash provided by operating activities increased $18.1 million during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to increased profitability, an increase in cash collected from customers, and the favorable impact of lower costs and insurance recoveries associated with the 2024 cybersecurity incident. These favorable impacts were partially offset by an increase in inventories and deferred preservation costs to support the increase in revenues.
Current wording
Net cash used in operating activities decreased by $1.8 million during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, as an increase in cash collected from customers and the insurance recoveries associated with the 2024 cybersecurity incident were partially offset by transaction and integration expenditures associated with our acquisition of Endospan, the $10.2 million payment for transaction bonuses for Endospan employees associated with the Endospan acquisition, and an increase in inventories to support revenue growth.
Previous wording
Net cash used in investing activities was $10.5 million and $3.6 million for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 cash flows used in investing activities included $8.0 million of cash used for capital expenditures, $1.5 million payment related to sale of PerClot, and $1.0 million payment for Endospan agreements.
Current wording
Net cash used in investing activities was $139.9 million and $6.9 million for the six months ended June 30, 2026 and 2025, respectively. During the six months ended June 30, 2026 cash flows used in investing activities included $116.7 million of payments related to the acquisition of Endospan, net of cash acquired, $18.8 million of cash used for capital expenditures, $3.0 million of payments under the Endospan agreements, and $1.5 million payment related to sale of PerClot.
Previous wording
Net cash provided by financing activities was $0.5 million and $3.9 million for the three months ended March 31, 2026 and 2025, respectively. The current year cash provided by financing activities was primarily due to $1.3 million of proceeds from the exercise of stock options and issuances of common stock, partially offset by $0.6 million for principal payments on short-term notes payable.
Current wording
Net cash provided by financing activities was $152.9 million and $6.5 million for the six months ended June 30, 2026 and 2025, respectively. The current year cash provided by financing activities was primarily due to $148.9 million of proceeds received on the New Delayed Draw Term Loan Facility, $3.2 million of proceeds from financing insurance premiums, $2.6 million of proceeds from the exercise of stock options and issuances of common stock, partially offset by $1.4 million for principal payments on short-term notes payable.
Previous wording
As of March 31, 2026 there have been no material changes outside of the ordinary course of business with respect to our material cash requirements for our contractual and other obligations as set forth in the table included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025.
Current wording
Other than the borrowing, related anticipated interest payments, contingent payment obligations, and payment described above, there have been no material changes outside of the ordinary course of business with respect to our material cash requirements for our contractual and other obligations as set forth in the table included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025.
Previous wording
Capital expenditures were $8.0 million and $3.6 million for the three months ended March 31, 2026 and 2025, respectively. Capital expenditures for the three months ended March 31, 2026 were primarily related to computer software development, purchases of manufacturing and tissue processing equipment, leasehold improvements, and computer equipment to support our business.
Current wording
Capital expenditures were $18.8 million and $6.9 million for the six months ended June 30, 2026 and 2025, respectively. Capital expenditures for the six months ended June 30, 2026 were primarily related to computer software development, purchases of manufacturing and tissue processing equipment, leasehold improvements, and computer equipment to support our business.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
The increase in total cost of products for the three months ended June 30, 2026 was primarily due to an increase in the volume of aortic stent grafts and On-X products shipped, as compared to the three months ended June 30, 2025.
Current report — wording carried from elsewhere
The increase in gross margin for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, was primarily due to higher average selling prices for certain products and tissues shipped, an increase in volume of certain products shipped, and favorable foreign currency effects for the three months ended June 30, 2026. The increase was partially offset by unfavorable cost of certain products shipped, as compared to the three months ended June 30, 2025. Gross margin as a percentage of total revenues decreased for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. Gross margin as a percentage of total revenues was negatively impacted by an unfavorable geographic mix and unfavorable costs of certain products and tissues shipped, partially offset by favorable pricing of certain products shipped, during the three months ended June 30, 2026.