Bioventus Inc.
For the period ended Sep 27, 2025. Filed Nov 4, 2025.
View on SEC.govAbout this filing
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.
Sep 27, 2025 · Filed Nov 4, 2025
BVS$10.61-0.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-28; filed 2025-08-06.
0001665988-25-000017
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-27; filed 2025-11-04.
0001665988-25-000026
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 116 previous paragraphs and 127 current paragraphs.
65 unchanged; 26 reworded; 34 added; 24 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 22 previous and 23 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 (34)
Current report
•Pain Treatments, consisting of:
Current report
•Surgical Solutions, consisting of:
Current report
•Restorative Therapies, consisting of:
Current report
2025 Credit Agreement
Current report
On July 31, 2025, we entered into a new Credit Agreement (the “2025 Credit Agreement”) that provides for a $300.0 million term loan facility (the “2025 Term Loan”) and a $100.0 million revolving credit facility (the “2025 Revolver”). Proceeds from the 2025 Term Loan, borrowings of $30.0 million under the 2025 Revolver and $2.6 million of available cash were used to fully repay the outstanding balance under the 2019 Credit and Guaranty Agreement, as amended, which totaled $332.6 million at the time of repayment. We recorded a $0.3 million loss on extinguishment and incurred $0.8 million in third-party costs as a result of these refinancing transactions.
Current report
XCELL PRP System
Current report
In August 2025, we fully launched the XCELL PRP System in the Orthopedic and Sports Medicine specialties across the U.S. market. The XCELL PRP System is designed to deliver customization, precision and efficiency with high platelet count in a single 10-minute process, allowing providers to select between leukocyte-rich and leukocyte-poor options with flexible dosing to meet individual patient and procedural needs.
Current report
(g)Losses incurred due to the refinancing of long-term debt.
Current report
(j)Other items include charges associated with strategic initiatives, such as potential acquisitions or divestitures, as well as costs related to a transformative project aimed at redesigning the Company’s systems and information processing infrastructure.
Current report
Other items during the nine months ended September 27, 2025 primarily consisted of $0.4 million of expenses related to the divestiture of the Advanced Rehabilitation Business, which was completed on December 31, 2024.
Current report
Net sales for the period increased $0.4 million, or 0.3%, compared to the prior year period. Net sales from Pain Treatments increased $3.7 million due to volume growth. Net sales from Surgical Solutions increased $3.8 million, primarily due to volume growth in BGS and Ultrasonics. Net sales from Restorative Therapies decreased $7.1 million due to a decline of $8.7 million in net sales associated with the divestiture of Advanced Rehabilitation Business. This decline was partially offset by a $1.6 million increase in net sales for our EXOGEN Bone Stimulation System.
Current report
Net sales decreased compared to the prior year period, primarily due to the divestiture of the Advanced Rehabilitation Business, which contributed $2.1 million in net sales during the three months ended September 28, 2024. The decline resulting from this divestiture was partially offset by increased net sales for our EXOGEN Bone Stimulation System, Pain Treatments and Surgical Solutions products.
Current report
Net sales decreased compared to the prior year period primarily due to the divestiture of the Advanced Rehabilitation Business, which contributed $5.7 million in net sales during the prior year. This decline was partially offset by volume growth in Pain Treatments and Surgical Solutions.
Current report
Gross profit increased $1.7 million, or 2.1%, compared to the prior year period, primarily driven by volume growth in BGS, Durolane and our EXOGEN Bone Stimulation System. The increase was partially offset by a $5.2 million reduction resulting from the divestiture of the Advanced Rehabilitation Business. Gross margin improved 1.1% compared to the prior year period, driven by a favorable product mix. These improvements were partially offset with freight and tariff costs.
Current report
Gross profit decreased $1.0 million, or 10.7%, compared to the prior year period. The decline was due to a $1.4 million reduction resulting from the divestiture of the Advanced Rehabilitation Business. This was partially offset by growth in BGS and our EXOGEN Bone Stimulation System. Gross margin declined 4.0% reflecting unfavorable product and country mix.
Current report
Gross profit decreased $5.7 million, or 2.2%, compared to the prior year period. The decline was primarily attributable to a $15.8 million reduction resulting from the divestiture of the Advanced Rehabilitation Business. This reduction was partially offset by volume growth in Surgical Solutions, Pain Treatments and our EXOGEN Bone Stimulation System. Gross margin slightly increased by 0.1% in comparison to the prior year period. This improvement was driven by a favorable product mix within both Surgical Solutions and Pain Treatments, as well as enhanced collections associated with our EXOGEN Bone Stimulation System. These gains were partially offset with freight and tariff costs, as well as shifts in channel mix.
Current report
Gross profit decreased $0.5 million, or 1.8%, primarily due to a $3.2 million reduction resulting from the divestiture of the Advanced Rehabilitation Business. This reduction was partially offset with growth in the remaining businesses. Gross margin decreased 0.5% due to product and country mix.
Current report
Selling, general and administrative expenses decreased by $2.8 million, or 3.5%, primarily due to a $2.6 million reduction in compensation-related costs, partially attributable to the sale of the Advanced Rehabilitation Business.
Current report
Following the decision to divest the Advanced Rehabilitation Business, we evaluated it for impairment in the second quarter of 2024. As a result, impairment losses of $2.0 million and $33.9 million were recorded for the three and nine months ended September 28, 2024, respectively, related to the net intellectual property solely attributable to the Advanced Rehabilitation Business. The losses, measured at fair value less costs to sell, were based on the purchaser’s consideration.
Current report
(Gain) loss on disposals
Current report
During the nine months ended September 27, 2025, we recorded a $0.3 million loss on disposal related to the sale of the Advanced Rehabilitation Business. The cumulative loss was due to post-closing working capital adjustments.
Current report
Interest expense, net decreased during both the three and nine months ended September 27, 2025, compared to the prior year periods. This decrease was due to lower debt outstanding and a reduction in interest rates and applicable margins. The third quarter of 2025 was further impacted by our debt refinancing completed during the quarter, which contributed to the overall reduction in interest expense.
Current report
Income tax expense (benefit), net
Current report
Adjusted EBITDA increased $3.8 million, or 19.2%, compared to the prior year period. This increase was primarily attributable to higher gross margin and lower operating expenses. These improvements were partially offset by the impact of the Advanced Rehabilitation Business divestiture and unfavorable movements in foreign currency.
Current report
Adjusted EBITDA decreased $0.7 million, or 18.7%, compared to the prior year period. The decline was primarily attributable to the decrease in gross profit resulting from the divestiture of the Advanced Rehabilitation Business.
Current report
Adjusted EBITDA decreased $2.0 million, or 2.9%, compared to the prior year period. The decline was primarily due to lower gross profit resulting from the divestiture of the Advanced Rehabilitation Business and unfavorable movements in foreign currency. This impact was mostly offset with volume growth in the remaining businesses.
Current report
The five-year 2025 Revolver includes an initial annual commitment fee of 0.30%, calculated based on the average daily amount of the available revolving commitment, which includes revolving and swingline loans as well as letters of credit (“LOC”). The commitment fee is payable quarterly in arrears on the last day of each calendar quarter and at maturity. The commitment rate is subject to adjustment based on our leverage ratio. Swingline loans are available as base rate option loans and LOCs are limited to $7.5 million under the 2025 Credit Agreement.
Current report
As of September 27, 2025, we had $72.8 million available on the 2025 Revolver, net of $2.2 million in outstanding LOCs. This availability, combined with our existing cash balances and expected cash flows from operations, provides us with sufficient liquidity to meet our near-term obligations and support ongoing operations.
Current report
We anticipate that, to the extent additional capital is required, we will seek funding through a combination of equity financings, the incurrence of additional indebtedness, or other strategic sources of capital. Our ability to access these sources will depend on market conditions, our financial performance, and other factors.
Current report
The following table summarizes material changes to our estimated future cash requirements associated with debt and related obligations:
Current report
(a)Refer to Item 1. Financial Information—Notes to the unaudited consolidated condensed financial statements—Note 4. Financial instrumentsin this report for further information regarding our long-term debt obligations.
Current report
As of September 27, 2025, we had an outstanding balance of $25.0 million under the 2025 Revolver and $297.6 million outstanding under the 2025 Term Loan, net of original issue discount and deferred financing costs. Subsequent to September 27, 2025, we made additional repayments totaling $17,000 on the 2025 Revolver.
Current report
Net cash from operating activities increased $17.2 million for the nine months ended September 27, 2025, compared to the prior year period. The increase was primarily driven by a decrease in interest payments resulting from favorable interest rates and less debt outstanding, increased collections, and less strategic transaction costs and expenses associated with transformative projects. These inflows were partially offset with larger compensation-related payments and other changes in working capital.
Current report
Net cash flows from financing activities decreased $22.0 million for the nine months ended September 27, 2025, compared to the prior year period. The decrease was driven by: (i) net cash outflows of $27.4 million related to the refinancing of our long-term debt obligations, including proceeds from the 2025 Credit Agreement, principal payments and associated financing costs; and (ii) a $19.8 million contingent consideration payment related to a previous acquisition. These outflows were partially offset by $25.0 million in net borrowings under our revolving credit facilities during the period.
Removed paragraphs (24)
Previous report
•Pain Treatments, comprised of:
Previous report
•Surgical Solutions, comprised of:
Previous report
•Restorative Therapies, comprised of:
Previous report
(i)Other items includes charges associated with strategic transactions, including potential acquisitions or divestitures and a transformative project to redesign systems and information processing. Other items during the six months ended June 28, 2025 primarily consisted of $0.5 million of divestiture expenses related to the Advanced Rehabilitation Business sold on December 31, 2024.
Previous report
Net sales decreased $5.6 million, or 4.2%, compared to the prior year period. Changes by business were: (i) Pain Treatments—$0.8 million decrease due to lower average selling price (“ASP”) driven by lower than normal private payer rebates in the prior year; (ii) Surgical Solutions—$4.0 million increase due to volume growth in BGS and Ultrasonics; and (iii) Restorative Therapies—$8.8 million decrease due to a net decline of $10.6 million in sales reflecting the divestiture of our Advanced Rehabilitation Business, partially offset by a $1.7 million increase for our EXOGEN Bone Stimulation System.
Previous report
Net sales increased compared to the prior year comparable period primarily due to an increase in our sales in Pain Treatments for Durolane and in Surgical Solutions for Ultrasonics, partially offset by the divestiture of our Advanced Rehabilitation Business, which totaled $1.6 million.
Previous report
Net sales slightly increased compared to the prior year comparable period primarily due to an increase in our sales in Pain Treatments for Durolane and in Surgical Solutions for Ultrasonics, offset by the divestiture of our Advanced Rehabilitation Business, which totaled $3.5 million.
Previous report
Gross profit decreased $3.6 million, or 3.8%, primarily due to the $5.5 million decline resulting from the divestiture of our Advanced Rehabilitation Business. This decrease was partially offset by volume growth in Surgical Solutions and our EXOGEN Bone Stimulation System. The slight increase in gross margin resulted from the divestiture of our Advanced Rehabilitation Business, offset by freight and tariff costs for our EXOGEN Bone Stimulation System.
Previous report
Gross profit increased $2.0 million, or 21.6%, primarily due to volume growth in Pain Treatments and Surgical Solutions, partially offset by the $0.7 million decline resulting from the divestiture of our Advanced Rehabilitation Business. Gross margin increased due to favorable movements in ASP.
Previous report
Gross profit decreased $7.4 million, or 4.3%, primarily due to the $10.6 million decline in sales resulting from the divestiture of our Advanced Rehabilitation Business. This decrease was partially offset by volume growth in Pain Treatments, Surgical Solutions and our EXOGEN Bone Stimulation System. The decrease in gross margin resulted from: (i) a decrease in ASP in certain Pain Treatment products as a result of temporary shifts in channel mix; and (ii) freight and tariff costs for our EXOGEN Bone Stimulation System.
Previous report
Gross profit increased $0.5 million, or 2.9%, primarily due to volume growth in Pain Treatments and Surgical Solutions, partially offset by a $1.8 million decline in sales resulting from the divestiture of our Advanced Rehabilitation Business. Gross margin increased due to favorable movements in ASP, partially offset by an unfavorable change in product and country mix.
Previous report
Selling, general and administrative expenses decreased by $22.8 million, or 13.0%, due to decreases in: (i) shareholder litigation costs settled during 2024 of $13.6 million; (ii) compensation-related costs of $8.0 million from less commissions on lower sales and an overall reduction in compensation expenses, which were partially driven by the sale of the Advanced Rehabilitation Business; and (iii) stock-based compensation of $2.9 million.
Previous report
We evaluated the Advanced Rehabilitation Business for impairment during the second quarter of 2024 due to our decision to divest the business. As a result of this evaluation, we recorded a $31.9 million impairment to reduce the intangible assets of the Advanced Rehabilitation Business to reflect their respective fair values less any costs to sell. We based the fair value of its intangibles on the consideration agreed to with the purchaser of the Advanced Rehabilitation Business.
Previous report
Loss on disposals
Previous report
Loss on disposals during the three and six months ended June 28, 2025 resulted from working capital adjustments associated with the sale of our Advanced Rehabilitation Business.
Previous report
Income tax (benefit) expense, net
Previous report
Adjusted EBITDA decreased $3.1 million, or 9.9%, in the three months ended June 28, 2025 compared to the prior year period primarily due to lower gross profit resulting from the divestiture of our Advanced Rehabilitation Business and the impact of foreign currency, partially offset by lower compensation-related expenses.
Previous report
Adjusted EBITDA increased $2.4 million or 84.3%, in the three months ended June 28, 2025 compared to the prior year period primarily due to the increase in gross profit from Durolane and Surgical Solutions and lower administrative expenses, partially offset by a reduction of gross profit resulting from the divestiture of our Advanced Rehabilitation Business.
Previous report
Adjusted EBITDA decreased $5.8 million, or 11.3%, in the six months ended June 28, 2025 compared to the prior year period primarily due to lower gross profit resulting from the divestiture of our Advanced Rehabilitation Business and the impact of foreign currency, partially offset by lower compensation-related expenses.
Previous report
We anticipate that to the extent that we require capital, we will obtain funding through additional equity financings or the incurrence of other indebtedness or a combination of these potential sources of capital. As of June 28, 2025, we had the ability to borrow up to an additional $32.8 million on our Revolving Credit Facility net of outstanding letters of credit.
Previous report
The Amended 2019 Credit Agreement, repaid on July 31, 2025, contained customary affirmative and negative covenants, including those related to financial reporting and notification, restrictions on the declaration or payment of certain distributions on or in respect of Bioventus LLC’s equity interests, restrictions on acquisitions, investments and certain other payments, limitations on the incurrence of new indebtedness, limitations on transfers, sales and other dispositions of assets of Bioventus LLC and its subsidiaries, as well as limitations on making changes to the business and organizational documents of Bioventus LLC and its subsidiaries. Financial covenant requirements included a maximum debt leverage ratio and an interest coverage ratio. We were subject to certain additional requirements and covenants, including a requirement to maintain Liquidity (as defined in the Amended 2019 Credit Agreement) of not less than$10.0 million as of the end of each calendar month during such period. We were in compliance with the financial covenants as stated in the Amended 2019 Credit Agreement as of June 28, 2025.
Previous report
We had an outstanding Revolver balance of $5.0 million as of June 28, 2025, which was borrowed and used for working capital needs. We paid the remaining Revolver balance of $5.0 million on July 11, 2025.
Previous report
Net cash from operating activities decreased $2.6 million due to larger compensation payments in 2025 compared to the prior year and a decline in sales and an increase in inventory purchases. These operating cash outflows were partially offset by a decrease in interest payments resulting from the timing of interest payments and less debt outstanding.
Previous report
Net cash flows from financing activities decreased $1.6 million due to a $19.8 million payment for contingent consideration related to a previous acquisition, partially offset by $12.5 million less in principal and deferred financing payments and $5.0 million in net borrowings on our Revolver during 2025.
Reworded paragraphs (26)
Previous wording
TalisMann combines our patented electric field conduction technology with an integrated pulse generator to potentially reach deeper, larger nerves. This combination is designed to provide long-term relief from chronic nerve pain for patients, potentially increasing the number of patients who respond to neuromodulation therapy. From a physician's perspective, the increase in power allows for easier lead placement and potentially broadens addressable nerves. StimTrial provides physicians the ability to evaluate patient response to PNS therapy, which we expect will facilitate physician adoption and payer reimbursement where trial assessments are required. We expect to begin a limited commercial release of both TalisMann and StimTrial in select U.S. markets during the third quarter, with a broader rollout planned for early 2026.
Current wording
TalisMann combines our patented electric field conduction technology with an integrated pulse generator to potentially reach deeper, larger nerves. This combination is designed to provide long-term relief from chronic nerve pain for patients, potentially increasing the number of patients who respond to neuromodulation therapy. From a physician's perspective, the increase in power allows for easier lead placement and potentially broadens addressable nerves. StimTrial provides physicians the ability to evaluate patient response to PNS therapy, which we expect will facilitate physician adoption and payer reimbursement where trial assessments are required. We began a limited commercial release of both TalisMann and StimTrial in select U.S. markets during the third quarter, with a broader rollout planned for early 2026.
Previous wording
On December 31, 2024, we closed the sale of certain products within our Advanced Rehabilitation Business, including the L100, L300 Go, L360, H200, Vector Gait & Safety System and Bioness Integrated Therapy System (collectively, the “Advanced Rehabilitation Business”). The Advanced Rehabilitation Business was considered non-core and required additional research and development expenditures to achieve its next stage of growth. We received $24.7 million at closing, net of transactional fees, subject to a post-closing adjustment for net working capital. We paid $0.7 million in the second quarter of 2025 to settle the adjustment for net working capital. The proceeds were used to pay $20.0 million in long-term debt obligations on December 31, 2024. We may also receive an aggregate of $20.0 million in potential earn-out payments, which are based on the achievement of certain revenue and financial metric thresholds in respect to sales of products from the Advanced Rehabilitation Business during the 2025 and 2026 fiscal years.
Current wording
On December 31, 2024, we completed the sale of certain products within our Advanced Rehabilitation Business, including the L100, L300 Go, L360, H200, Vector Gait & Safety System and Bioness Integrated Therapy System (collectively, the “Advanced Rehabilitation Business”). This divestiture reflects our strategic decision to focus on core business areas and streamline operations. The Advanced Rehabilitation Business was considered non-core and required additional research and development investment to achieve its next stage of growth. We received $24.7 million of cash proceeds at closing, net of transactional fees, which were subject to a post-closing adjustment for net working capital. We paid $0.7 million in the second quarter of 2025 to settle the adjustment for net working capital. The net proceeds were used to pay $20.0 million in long-term debt obligations on December 31, 2024. We may also receive an aggregate of $20.0 million in potential earn-out payments based on the achievement of certain revenue and financial performance thresholds related to the Advanced Rehabilitation Business during the fiscal years ending December 31, 2025 and 2026.
Previous wording
(a)Includes for the three and six months ended June 28, 2025 and June 29, 2024, respectively, depreciation and amortization of $10.6 million, $11.0 million, $20.9 million and $21.0 million in cost of sales and $1.4 million, $2.1 million, $3.0 million and $3.9 million in operating expenses presented in the consolidated condensed statements of operations and comprehensive income (loss).
Current wording
(a)Includes for the three and nine months ended September 27, 2025 and September 28, 2024, respectively, depreciation and amortization of $10.0 million, $10.2 million, $30.9 million and $31.3 million in cost of sales and $1.4 million, $2.1 million, $4.4 million and $5.9 million in operating expenses presented in the consolidated condensed statements of operations and comprehensive income (loss).
Previous wording
(f)Financial restructuring costs in 2025 related to our new 2025 Credit Agreement. Activity in 2024 is attributable to advisory fees and debt amendment related costs related to our Amended 2019 Credit Agreement.
Current wording
(f)Debt refinancing in 2025 related to certain third-party fees associated with our 2025 Credit Agreement. Activity in 2024 is attributable to advisory fees and debt amendment related costs related to our 2019 Credit and Guaranty Agreement, as amended.
Previous wording
(g)Represents the loss on the disposal of the Advanced Rehabilitation Business.
Current wording
(h)Represents the loss on the disposal of the Advanced Rehabilitation Business.
Previous wording
(h)Represents a non-cash impairment charge for intangible assets solely attributable to our Advanced Rehabilitation Business in 2024 due to our decision to divest the business.
Current wording
(i)Represents a non-cash impairment charge for intangible assets solely attributable to our Advanced Rehabilitation Business in 2024 due to our decision to divest the business.
Previous wording
During the three and six months ended June 29, 2024, other items primarily consisted of: (i) strategic transaction expenses of $1.8 million and $2.3 million, respectively, primarily related to Advanced Rehabilitation Business divestiture expenses; and (ii) transformative project costs of $0.5 million and $1.3 million, respectively.
Current wording
For the three and nine months ended September 28, 2024, other items primarily consisted of strategic transaction expenses of $1.6 million and $3.9 million, respectively, primarily related to the divestiture of the Advanced Rehabilitation Business. The nine months ended September 28, 2024 also included transformative project costs of $1.3 million.
Previous wording
We present Adjusted EBITDA, a non-GAAP financial measure, because we believe it is a useful indicator for management to measure operating performance and for planning purposes, including the preparation of our annual operating budget and financial projections. We believe that Adjusted EBITDA is useful to our investors because it is frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies in industries similar to ours. We define Adjusted EBITDA as net income (loss) from operations before depreciation and amortization, provision of income taxes and interest expense, net, adjusted for the impact of certain cash, non-cash and other items that we do not consider in our evaluation of ongoing operating performance. These items include acquisition and divestiture related costs, certain shareholder litigation costs, impairments of assets, restructuring and succession charges, equity compensation expense, financial restructuring costs and other items. Adjusted EBITDA by segment is comprised of net sales and costs directly attributable to a segment, as well as an allocation of corporate overhead costs primarily based on a ratio of net sales by segment to total consolidated net sales.
Current wording
We present Adjusted EBITDA, a non-GAAP financial measure, because we believe it is a useful indicator for management to measure operating performance and for planning purposes, including the preparation of our annual operating budget and financial projections. We believe that Adjusted EBITDA is useful to our investors because it is frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies in industries similar to ours. We define Adjusted EBITDA as net income (loss) from operations before depreciation and amortization, provision of income taxes and interest expense, net, adjusted for the impact of certain cash, non-cash and other items that we do not consider in our evaluation of ongoing operating performance. These items include acquisition and divestiture related costs, certain shareholder litigation costs, impairments of assets, restructuring and succession charges, equity compensation expense, debt refinancing, loss on extinguishment of debt and other items. Adjusted EBITDA by segment consists of net sales and costs directly attributable to a segment, as well as an allocation of corporate overhead costs primarily based on a ratio of net sales by segment to total consolidated net sales.
Previous wording
Net sales decreased $9.4 million, or 3.8%, compared to the prior year period. Changes by business were: (i) Pain Treatments—$1.3 million increase due to volume growth primarily driven by Durolane partially offset by a decline in volume, in part, due to inventory reductions by certain distributors following higher purchases at the end of 2024 and a shift in channel mix; (ii) Surgical Solutions—$6.5 million increase due to volume growth in BGS and Ultrasonics; and (iii) Restorative Therapies—$17.2 million decrease due to a net decline in sales of $20.1 million reflecting the divestiture of our Advanced Rehabilitation Business, partially offset by a $3.0 million increase in our sales for our EXOGEN Bone Stimulation System.
Current wording
Net sales for the period decreased $9.0 million, or 2.4%, compared to the prior year period. Net sales from Pain Treatments increased $5.0 million, driven by volume growth in Durolane. This increase was partially offset with a decline in volume for certain products, in part due to inventory reductions by certain distributors following elevated purchases at the end of 2024. Net sales from Surgical Solutions increased $10.3 million due to volume growth in BGS and Ultrasonics. The $24.3 million decline in net sales from Restorative Therapies was driven by the divestiture of the Advanced Rehabilitation Business, which contributed $28.8 million in net sales during the prior year. This decrease was partially offset by a $4.5 million increase in our net sales for our EXOGEN Bone Stimulation System.
Previous wording
Selling, general and administrative expenses decreased by $17.6 million, or 18.2%, due to decreases in: (i) shareholder litigation costs settled during 2024 of $12.5 million; (ii) compensation-related costs of $2.8 million from less commissions due to lower sales and an overall reduction in compensation expenses, which were partially driven by the sale of the Advanced Rehabilitation Business; and (iii) stock-based compensation of $1.8 million.
Current wording
Selling, general and administrative expenses decreased by $25.7 million, or 10.0%, primarily due to: (i) a $13.7 million reduction in shareholder litigation costs settled during 2024; (ii) a $10.6 million decrease in compensation-related costs, partially attributable to the sale of the Advanced Rehabilitation Business; and (iii) a $2.2 million decrease in stock-based compensation.
Previous wording
Research and development expense decreased $0.7 million, or 9.6%, due to a $0.5 million decline in consulting expenses resulting from the completion of certain projects and a decrease of $0.4 million in compensation-related costs.
Current wording
Research and development expense decreased $0.9 million, or 23.9% due to: (i) a $0.6 million reduction in consulting expenses resulting from the completion of certain projects; and (ii) a $0.4 million decrease in compensation-related costs.
Previous wording
Research and development expense decreased $1.0 million, or 24.7% due to decreases in: (i) compensation-related costs of $0.4 million; (ii) consulting expenses of $0.3 million due to the completion of certain projects; and (iii) stock-based compensation of $0.3 million.
Current wording
Research and development expense decreased by $1.6 million, or 14.7%, primarily due to: (i) a $1.1 million reduction in consulting expenses resulting from the completion of certain projects; and (ii) a $0.8 million decrease in compensation-related costs.
Previous wording
Activity from the change in fair value of contingent consideration relates to contingent consideration associated with the acquisition of Bioness in March 2021. Certain milestones were achieved during the fourth quarter of 2024 and as a result, we ceased revaluing the contingent consideration liability in 2025. We made contingent consideration payments of $9.0 million and $10.8 million during the first and second quarters of 2025, respectively, which settled the Bioness contingent consideration liability in its entirety.
Current wording
Activity from the change in fair value of contingent consideration relates to the acquisition of Bioness in 2021. Certain milestones were achieved during the fourth quarter of 2024, and as a result, we ceased revaluing the contingent consideration liability in 2025. We made contingent consideration payments of $9.0 million and $10.8 million during the first and second quarters of 2025, respectively, which fully settled the Bioness contingent consideration liability.
Previous wording
Depreciation and amortization decreased during the three and six months ended June 28, 2025 compared to the prior year comparable periods primarily due to certain information technology assets being fully depreciated in 2025.
Current wording
Depreciation and amortization decreased during the three and nine months ended September 27, 2025 compared to the prior year comparable periods primarily due to certain information technology assets being fully depreciated in 2025.
Previous wording
Interest expense, net decreased during the three and six months ended June 28, 2025 compared to the prior year comparable periods due to less debt outstanding and a decrease in interest rates. The increase in other expense, net during the three and six months ended June 28, 2025 was due to fluctuations in foreign currency compared to the prior year comparable periods.
Current wording
Loss on extinguishment of debt recognized during the three and nine months ended September 27, 2025 was directly related to the refinancing of our debt obligations. The increase in other expense, net during both the three and nine months ended September 27, 2025 was due to fluctuations in foreign currency exchange rates compared to the prior year periods.
Previous wording
The effective tax rate for the six months ended June 28, 2025 was based upon foreign income tax partially offset with the release of certain reserves for uncertain tax positions. The effective tax rate for the six months ended June 29, 2024 was due to the impairment of intangibles related to the Advanced Rehabilitation Business and taxable income in certain entities.
Current wording
Our effective tax rate was 14.2% for the three months ended September 27, 2025, primarily driven by income earned in foreign jurisdictions. The effective tax rate was 13.9% for the nine months ended September 27, 2025, driven by foreign income tax, partially offset with the release of certain reserves for uncertain tax positions. The effective tax rate for both the three and nine months ended September 28, 2024 was 11.2%, primarily due to the impairment of intangibles related to the Advanced Rehabilitation Business and taxable income in certain entities.
Previous wording
Adjusted EBITDA increased $1.7 million or 29.7%, in the six months ended June 28, 2025 compared to the prior year period primarily due to lower administrative expenses partially offset by lower gross profit resulting from the divestiture of our Advanced Rehabilitation Business.
Current wording
Adjusted EBITDA increased $1.0 million, or 10.1%, compared to the prior year period. The increase was primarily driven by lower selling, general and administrative expenses, partially offset by lower gross profit resulting from the divestiture of our Advanced Rehabilitation Business.
Previous wording
On December 31, 2024, we closed the sale of the Advanced Rehabilitation Business, which was considered non-core and required additional research and development expenditures to achieve its next stage of growth. We received $24.7 million at closing, net of transactional fees, subject to a post-closing adjustment for net working capital. We paid $0.7 million in the second quarter of 2025 to settle the adjustment for net working capital. The proceeds were used to pay $20.0 million in long-term debt obligations on December 31, 2024. We may also receive an aggregate of $20.0 million in potential earn-out payments, which are based on the achievement of certain revenue and financial metric thresholds in respect to sales of products from the Advanced Rehabilitation Business during the 2025 and 2026 fiscal years.
Current wording
On December 31, 2024, we closed the sale of the Advanced Rehabilitation Business, which was considered non-core and required additional research and development expenditures to achieve its next stage of growth. We received cash proceeds of $24.7 million at closing, net of transactional fees, which were subject to a post-closing adjustment for net working capital. We paid $0.7 million in the second quarter of 2025 to settle the adjustment for net working capital. Net proceeds from the transaction were used to pay $20.0 million in long-term debt obligations on December 31, 2024. We may also receive up to an additional $20.0 million in contingent earn-out payments, based on the achievement of certain revenue and financial performance thresholds related to the Advanced Rehabilitation Business during the fiscal years ending December 31, 2025 and 2026.
Previous wording
On July 31, 2025, we entered into a Credit Agreement (the “2025 Credit Agreement”) consisting of a $300.0 million term loan facility (the “2025 Term Loan”) and a $100.0 million revolving credit facility (the “2025 Revolver”). The proceeds resulting from the 2025 Term Loan, $30.0 million in borrowings on the 2025 Revolver and $2.6 million in available cash were used to repay the outstanding Term Loan balance under the Amended 2019 Credit Agreement, which totaled $332.6 million on July 31, 2025. The 2025 Credit Agreement is expected to provide $2.0 million of annual interest expense savings, increased liquidity and debt maturity extension to July 2030. On August 1, 2025, the Company entered into two interest rate swaps totaling $150.0 million to hedge the interest rate risk associated with the Company’s floating-rate SOFR-based borrowings under the 2025 Credit Agreement.
Current wording
On July 31, 2025, we entered into the 2025 Credit Agreement that provides for a $300.0 million term loan (the “2025 Term Loan”) and a $100.0 million revolving credit facility (the “2025 Revolver”). Proceeds from the 2025 Credit Agreement, including $30.0 million in borrowings under its revolver and $2.6 million in available cash, were used to fully repay the outstanding balance under the 2019 Credit and Guaranty Agreement, as amended, which totaled $332.6 million as of July 31, 2025.
Previous wording
On July 31, 2025, we entered into the 2025 Credit Agreement, consisting of a $300.0 million 2025 Term Loan and the 2025 Revolver with a borrowing capacity of $100.0 million. The proceeds resulting from the 2025 Term Loan, $30.0 million in borrowings on the 2025 Revolver and $2.6 million in available cash were used to repay the outstanding loan balances under the Amended 2019 Credit Agreement, which totaled $332.6 million on July 31, 2025. The 2025 Credit Agreement is expected to provide $2.0 million of annual interest expense savings, increased liquidity and debt maturity extension to July 2030. On August 1, 2025, the Company entered into two interest rate swaps (“Interest Rate Swaps”) to hedge the interest rate risk associated with the Company’s floating-rate SOFR-based borrowings under the 2025 Credit Agreement. The Company will pay a fixed interest rate in exchange for SOFR-based variable interest throughout the life of the Interest Rate Swaps. The Interest Rate Swaps have a weighted average fixed interest rate of 3.60% and an underlying notional value of $150.0 million, or 50.0% of the 2025 Term Loan.
Current wording
The 2025 Credit Agreement is expected to provide $2.0 million of annual interest expense savings, increased liquidity and extended debt maturity to July 2030. On August 1, 2025, we entered into two interest rate swaps to mitigate the interest rate risk associated with our floating-rate SOFR-based borrowings under the 2025 Credit Agreement. Under the terms of swaps, we pay a fixed interest rate in exchange for SOFR-based variable interest throughout the life of the instruments. The interest rate swaps have a weighted average fixed interest rate of 3.60% and an aggregate notional value of $150.0 million, or 50.0% of the 2025 Term Loan.
Previous wording
There have been no material changes to our future cash requirements as disclosed in Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2024 10-K.
Current wording
Other than the above changes to debt and related obligations, there have been no material changes to our estimated future cash requirements as disclosed in Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Form 10-K.
Previous wording
We enter into contracts in the normal course of business with various third parties for development, collaboration and other services for operating purposes. These contracts generally provide for termination upon notice. Payments due upon cancellation generally consist only of payments for services provided or expenses incurred, including non-cancellable obligations of our service providers, up to the date of cancellation. Certain agreements include contingent events that upon occurrence would require payment. For information regarding commitments and contingencies, refer to Item 1. Financial Information—Notes to the unaudited consolidated condensed financial statements—Note 10. Commitments and contingencies.
Current wording
We enter into contracts in the ordinary course of business with various third parties for development, collaboration and other services. These agreements generally include provisions allowing for termination upon notice. In the event of cancellation, payments typically consist of amounts due for services rendered or expenses incurred through the termination date, including non-cancellable obligations of our service providers. Certain agreements also contain contingent provisions that may require payment upon the occurrence of specified events. For additional information regarding commitments and contingencies, refer to Item 1. Financial Information—Notes to the unaudited consolidated condensed financial statements—Note 10. Commitments and contingencies.
Previous wording
The 2025 Credit Agreement contains affirmative and negative covenants applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict the ability of the Company to, subject to negotiated exceptions, incur additional indebtedness, liens on its assets, engage in acquisitions or dispositions, pay dividends or make other distributions, enter into transactions with affiliated persons, make investments, change the nature of its business or organizational documents, or prepay or make modifications to other indebtedness that would adversely affect the Lenders. The 2025 Credit Agreement also contains financial covenants including a maximum consolidated total net leverage ratio of 4.00 to 1.00 for the fiscal quarter ending September 30, 2025 through the fiscal quarter ending December 31, 2025, and starting with the fiscal quarter ending March 31, 2026 and for each fiscal quarter thereafter, a maximum consolidated total net leverage ratio of 3.50 to 1.00. The Company may elect to increase such ratio level by 0.50 to 1.00 following certain permitted acquisitions. A minimum interest coverage ratio of 2.50 to 1.00 must also be maintained. The 2025 Revolver includes standard provisions related to conditions of borrowing and customary events of default. The Company does not expect any of these restrictions to affect or limit its ability to conduct business in the ordinary course.
Current wording
The 2025 Credit Agreement also contains financial covenants including a maximum consolidated total net leverage ratio of 4.00 to 1.00 for the quarter ending September 30, 2025 through the quarter ending December 31, 2025, and starting with the fiscal quarter ending March 31, 2026 and for each fiscal quarter thereafter, a maximum consolidated total net leverage ratio of 3.50 to 1.00. We may elect to increase such ratio level by 0.50 to 1.00 following certain permitted acquisitions. A minimum interest coverage ratio of 2.50 to 1.00 must also be maintained. The 2025 Revolver also includes standard provisions related to conditions of borrowing and customary events of default. We were in compliance with the financial covenants under the 2025 Credit Agreement as of September 27, 2025. We do not expect any of these covenants or restrictions to affect or limit our ability to conduct business in the ordinary course.
Previous wording
Refer to Item 1. Financial Information—Notes unaudited consolidated condensed financial statements—Note 1. Organizationfor further details on the Company’s covenant compliance and Note 4. Financial instruments for further details on the Company’s indebtedness.
Current wording
Refer to Item 1. Financial Information—Notes unaudited consolidated condensed financial statements—Note 4. Financial instruments for further details on the Company’s indebtedness.
Previous wording
Cash and cash equivalents as of June 28, 2025 totaled $32.9 million, compared to $41.6 million as of December 31, 2024. The change in cash was primarily due to the following:
Current wording
Cash and cash equivalents as of September 27, 2025 totaled $42.2 million, compared to $41.6 million as of December 31, 2024. The change in cash was primarily due to the following:
Previous wording
Net cash from investing activities decreased $1.1 million due to an increase of $1.1 million in capital expenditures primarily related to information technology and a working capital settlement of $0.7 million related to our sale of the Advanced Rehabilitation Business, partially offset by a $0.7 million outflow in 2024 for the purchase of an HA distribution right.
Current wording
Net cash from investing activities decreased by $1.5 million for the nine months ended September 27, 2025, compared to the prior year period. The decrease was driven by a $1.6 million increase in capital expenditures, primarily related to information technology assets and a $0.7 million working capital settlement associated with the sale of the Advanced Rehabilitation Business. These outflows were partially offset by the absence of a $0.7 million outflow in 2024 for the purchase of an HA distribution right.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
The 2025 Credit Agreement is expected to provide $2.0 million of annual interest expense savings, increased liquidity and extended debt maturity to July 2030. On August 1, 2025, we entered into two interest rate swaps totaling $150.0 million to hedge the interest rate risk associated with our floating-rate SOFR-based borrowings under the 2025 Credit Agreement.
Current report — wording carried from elsewhere
The 2025 Credit Agreement contains affirmative and negative covenants applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict our ability to, subject to negotiated exceptions, incur additional indebtedness, liens on our assets, engage in acquisitions or dispositions, pay dividends or make other distributions, enter into transactions with affiliated persons, make investments, change the nature of our business or organizational documents, or prepay or make modifications to other indebtedness that would adversely affect the Lenders.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The effective tax rate for the three months ended June 28, 2025 was driven by income in foreign jurisdictions. The effective rate for the three months ended June 29, 2024 was due to the impairment of intangibles related to the Advanced Rehabilitation Business and taxable income in certain entities.