Zimmer Biomet Reports 7% Net Sales Increase in Q2 2025, Earnings Decline

Zimmer Biomet Holdings, Inc. reported a net sales increase of 7.0% for the second quarter of 2025, reaching $2,077.3 million, compared to $1,942.0 million in the same period of 2024. For the first half of 2025, net sales totaled $3,986.4 million, up 4.0% from $3,831.2 million in the prior year. The growth was attributed to the acquisition of Paragon 28, which contributed 2.6% and 1.4% to sales growth in the second quarter and first half, respectively. Additionally, favorable foreign currency exchange rates positively impacted sales by 1.6% in the second quarter and 0.1% in the first half.

Despite the increase in sales, the company experienced a decline in net earnings, which fell to $152.8 million for the second quarter and $334.9 million for the first half, down from $242.8 million and $415.2 million, respectively, in the prior year. The decrease in earnings was primarily due to higher costs associated with the Paragon 28 acquisition, increased manufacturing costs driven by inflation, and investments in marketing and technology. Operating profit for the second quarter was $300.0 million, down from $351.3 million in the same quarter of 2024.

In terms of operational developments, Zimmer Biomet's acquisition of Paragon 28, completed in April 2025, is expected to enhance its market share in the foot and ankle orthopedic segment, which has been growing rapidly. The company also initiated a new global restructuring program in February 2025, aimed at reducing costs and transforming operations, with expected pre-tax charges of approximately $85 million by the end of 2027. The restructuring efforts are anticipated to yield annual savings of about $95 million relative to 2024 baseline expenses.

Geographically, sales in the United States increased by 6.1% to $1,173.8 million in the second quarter, while international sales rose by 8.1% to $903.5 million. The growth in the U.S. was driven by the Paragon 28 acquisition and market expansion in key product categories, including knees and hips. The company reported a total employee headcount of 318.4 million shares outstanding as of June 30, 2025, reflecting a slight increase from the previous year.

Looking ahead, Zimmer Biomet expects full-year revenue growth of 6.7% to 7.7% for 2025, driven by the continued integration of Paragon 28, new product introductions, and market growth. However, the company anticipates a decrease in net earnings due to higher acquisition-related costs, increased operating expenses, and a higher effective tax rate. The company is also preparing for potential impacts from tariffs, estimating an additional $40 million in expenses for the year.