Zimmer Biomet Lifts Annual Growth Despite Challenging Knee Market

Zimmer Biomet Holdings (NYSE:ZBH) stock is trading at a 52-week high after the better-than-expected third-quarter earnings.

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Q3 Financial Results Beat Wall Street Estimates

Chairman, President and CEO Ivan Tornos said, “…two-thirds of our book of business grew at least upper single-digit or double-digit rates, validating the strength of our innovation cycle, the improvement in our commercial execution efforts, and the resilience of our global market environment.”

The orthopedic implant company reported third-quarter adjusted earnings of $1.90 per share, beating estimates of $1.88.

The company reported quarterly sales of $2.063 billion, beating the estimates of $2.040 billion, driven by continued strength in hips and SET and Data and Technology, bone cement and surgical, partially offset by expected challenges in knees. 

Sales growth represents 3.1% reported growth and 3.7% constant currency growth.

Excluding the impact of China distributor network consolidation strategy, Tornos said in a one-time headwind in fiscal year 2026, the constant currency growth would have been 4.7%.

Segment Breakdown: Hip, SET and Robotic Technology Growth

The Hip segment grew 7% globally, with growth of 5.8% in the U.S. and 8.2% internationally, driven by new product cycle strength, which includes Z1, triple-tapered hip stem, and HEMR, the surgical impactor.

SET businesses grew at 7.1% globally, including mid-single-digit growth in the U.S. This was driven by strength across key franchises, including foot and ankle, sports medicine, CMFT (craniomaxillofacial and thoracic), and upper extremities, all of which grew between mid-single-digit and high-teens in the period. 

Technology and data, bone cement, and surgical grew at 13%, led by the strong demand for robotic offerings, including ROSA with Optymyze and TMINI.

Technology and data sales increased over 30% in the U.S.

Paragon 28 acquisition continued to grow at roughly three times the foot and ankle market, at over 18% growth, which is sustainable in the long run.

Knee Segment Headwinds

Ivan Tornos, chairman, president and CEO, said, “While we continue to expect ongoing pressure in the near term in our knee business, we are confident in our strategy and plan to return to sustainable growth over the long term by, number one, improving commercial execution.”

Fiscal 2026 Revenue and Earnings Outlook

Zimmer Biomet raises fiscal 2026 adjusted earnings guidance from $8.47-$8.59 per share to $8.50-$8.60 per share compared to the consensus of $8.54, citing strong performance in hips, SET, and technology and data segments.

The company narrowed its 2026 sales outlook from $8.553 billion-$8.635 billion to $8.594 billion-$8.635 billion compared to the Wall Street estimate of $8.597 billion.

Zimmer raised its organic constant currency sales growth expectation to 3% to 3.5%, up from the prior range of 2.25% to 3.25%.

ZBH Price Action: Zimmer Biomet Holdings shares were up 14.98% at $111.60 at the time of publication on Wednesday. The stock is trading at a new 52-week high, according to Benzinga Pro data.

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