OrthoPediatrics Q4 2024: Discrepancies in Growth, Margins, and Medicaid Coverage

These are the key contradictions discussed in OrthoPediatrics' latest 2024 Q4 earnings call, specifically including: OPSB Growth Expectations, Gross Margin Adjustments, Medicaid Coverage Impact, and Seasonality Expectations:



Record Impact and Market Dominance:
- OrthoPediatrics Corporation helped over 34,000 children in Q4 2024 and over 138,000 children in the full year, setting record highs.
- The company aims to help 1 million kids per year and establish market dominance in trauma, deformity correction, and scoliosis implants over the next five years.
- This growth is driven by the company's commitment to providing new products and technologies that meet unmet needs, delivering unparalleled customer service, and investing in important aspects of the pediatric field.

Revenue and Financial Performance:
- The company reported $52.7 million in total revenue for Q4 2024, representing 40% growth from the comparable period in 2023.
- This growth was driven by strong performances across trauma and scoliosis, contributed to by the addition of Boston O&P and strong domestic growth.
- The company also reported record adjusted EBITDA of $3.0 million for Q4 2024, more than doubled from the previous year.

Product Innovation and Expansion:
- New product launches such as PNP Tibia and DF2 have contributed significantly to revenue growth, with DF2 experiencing demand exceeding expectations.
- The company is expanding its specialty bracing business (OPSB) with clinic expansion and new product offerings like the DF2 femur fracture brace, which is growing rapidly.
- These innovations and expansions are supported by strategic investments in R&D and acquisitions, aiming to leverage OrthoPediatrics' growing sales channel and clinic network.

International Market Strategy:
- Despite facing challenges in South America due to currency fluctuations, international revenue grew by 5% year-over-year in Q4 2024.
- The company is focusing on EU MDR approval for expanded market access, anticipating significant growth opportunities in 2025 and beyond.
- This strategic focus on Europe aims to offset challenges in South American markets, ensuring consistent growth across international regions.