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- **Revenue Growth**: Q3 2025 sales up 5.2% YoY, driven by U.S. dental distribution (3.3%) and global specialty products (5.9%).
- **Strategic Momentum**: $200M+ operating income improvement plan over several years, with 60% of non-GAAP operating income from high-growth businesses by 2027.
- **Financial Performance**: Non-GAAP EPS of $1.38 (up 13% YoY), adjusted EBITDA growth of 10%, and $229M share buybacks in Q3.
- **KKR Partnership**: Expanded stake to 19.9%, reflecting confidence in long-term strategy and value creation initiatives.

**【Management Opening Remarks】**
- CEO Stanley Bergman highlighted Q3 2025 revenue growth across all segments, driven by U.S. dental distribution and global specialty products. He emphasized the BOLD+1 strategy, focusing on high-growth, high-margin businesses and a $200M+ operating income improvement plan over several years. The company also announced a $750M share buyback increase and KKR's expanded stake up to 19.9%.

**【CEO Commentary】**
- **Sales Momentum**: U.S. dental merchandise sales grew 3.3%, with strong corporate brand performance and promotional program success. Global specialty products, particularly implants, saw mid-single-digit growth, with value segment implants leading.
- **Strategic Initiatives**: Launched a new e-commerce platform in North America and Europe, expanded AI integration with AWS, and advanced value creation programs (e.g., centralizing support services, automating processes).
- **Long-Term Vision**: Aims for 60% of non-GAAP operating income from high-growth businesses by 2027, with a focus on owned brands and digital solutions.

**【CFO Financial Commentary】**
- **Q3 2025 Results**: GAAP net income of $101M ($0.84 EPS) and non-GAAP EPS of $1.38, up 13% YoY. Adjusted EBITDA grew 10% to $295M. Operating margin improved 19bps to 7.83% due to cost control, offset by 56bps gross margin decline.
- **Restructuring Impact**: $34M Q3 restructuring costs, with $100M+ annual savings expected. Value creation initiatives target $200M+ operating income gains over several years.
- **2025 Guidance Update**: Non-GAAP EPS raised to $4.88-$4.96, sales growth 3%-4%, and EBITDA mid-single-digit growth.

**【Q&A Highlights】**
- **Market Share & Growth**: U.S. dental distribution market share gains driven by promotional programs and new e-commerce platform. Global specialty products, especially implants, saw double-digit growth in key regions.
- **Gross Margin Stabilization**: U.S. dental distribution gross margins stabilized due to glove price stability and reduced promotions. Medical segment growth offset by lower-margin flu vaccine sales.
- **KKR Partnership**: KKR's increased stake reflects confidence in Henry Schein's strategy, with potential for closer collaboration on value creation initiatives.
- **2026 Outlook**: CFO indicated multiyear phasing of $200M+ operating improvements, with 2026 guidance to be provided in February 2026.

Henry Schein, Inc. (HSIC) Q3 2025 Earnings Call Transcript

- **Revenue Resilience**: Global sales +3.3% YoY, driven by Specialty (+4.2%) and Technology (+7.4%) growth.
- **Margin Recovery**: U.S. Distribution gross margin stabilization post-targeted initiatives, July sales rebound.
- **Cost Efficiency**: $100M+ annual restructuring savings by year-end, supporting 2026+ profitability.
- **Strategic Growth**: 45% of operating income from high-growth businesses, targeting >50% by year-end.
- **KKR Synergies**: Gross margin and SG&A efficiency projects expected to drive 2026+ value creation.

**【CEO Summary Section】**
- **Revenue Growth**: Global sales of $3.2 billion (+3.3% YoY), driven by strong performance in Specialty Products (+4.2%) and Technology (+7.4%). U.S. Medical Distribution grew 6.3% due to increased patient traffic and Home Solutions.
- **Margin Challenges**: U.S. Dental Merchandise margins pressured by lower glove pricing and targeted sales initiatives, partially offset by July sales rebound.
- **Strategic Initiatives**: Partnering with KKR's Capstone and global consulting firms to enhance distribution gross margins and efficiency. New e-commerce platform launched in North America.
- **BOLD+1 Strategy**: 45% of non-GAAP operating income from high-growth, high-margin businesses (target >50% by year-end). 10%+ contribution from corporate brands.
- **Restructuring**: Annual savings expected to exceed $100 million by year-end, supporting 2026+ profitability.
- **Succession Plan**: CEO to retire end-2025, with internal/external leadership transition underway.

**【CFO Financial Commentary】**
- **Earnings**: GAAP net income $86M (-17% YoY), Non-GAAP EPS $1.10 (-10%). Adjusted EBITDA $256M (-4.5% YoY).
- **Margins**: Non-GAAP operating margin 6.96% (-79bps YoY) due to U.S. Distribution gross margin decline.
- **Expenses**: Higher tech and marketing investments (+$259M share buybacks). Restructuring costs $23M, with $100M+ annual savings by year-end.
- **Guidance**: 2025 non-GAAP EPS $4.80-$4.94, sales +2-4%, adjusted EBITDA mid-single-digit growth.

**【Q&A Highlights】**
- **July Momentum**: Strong sales growth in Merchandise, Equipment, and Medical, with glove pricing stabilizing.
- **Tariff Navigation**: Passing tariffs to customers while promoting owned brands and second-tier manufacturers.
- **Ortho Turnaround**: Traditional ortho sales stabilizing, aligner business integrated into France facility.
- **DSO Expansion**: DSOs well-funded, investing in digital tools and equipment, driving new office design projects (+11% YoY in 2025).
- **KKR Initiatives**: Gross margin enhancement and SG&A efficiency projects expected to deliver results in 2026+.

Henry Schein, Inc. (HSIC) Q2 2025 Earnings Call Transcript

- **Strategic Momentum**: High-growth businesses to exceed 50% of operating income by 2027, driven by specialty products and digital solutions.
- **Revenue Resilience**: Q1 sales growth 2% (constant currency), with accelerating March sales and 23% growth in home solutions.
- **Profitability Improvement**: Non-GAAP EPS up 4.5% YoY to $1.15, operating margin expansion through cost savings ($75-100M annual target).
- **Tariff Mitigation**: Diversified sourcing and corporate brand alternatives limit financial impact, no immediate price pass-through.
- **Technology Growth**: Cloud-based dental software subscribers +20%, advancing into DSOs with enhanced functionality.


**【CEO Summary Section】**
- **Strategic Progress**: Advanced BOLD+1 strategy, with high-growth, high-margin businesses (specialty products, value-added services, technology) expected to contribute over 50% of operating income by 2027.
- **Sales Performance**: Q1 sales growth of 2% (constant currency, ex-PPE/COVID kits), driven by accelerating March sales. US dental merchandise grew low single-digits, medical sales benefited from respiratory illness trends.
- **Market Share**: Gained market share in implants and biomaterials, with mid-single-digit growth in DACH and Latin America.
- **Tariff Mitigation**: Diversified sourcing to lower-tariff countries, offering corporate brand alternatives for price-sensitive customers.
- **Technology Growth**: Practice management systems (Dentrix Ascend, Dentally) saw 20% cloud-based customer growth, with 9,500 subscribers.

**【CFO Financial Commentary】**
- **Q1 Financials**: GAAP net income $110M ($0.88 EPS), Non-GAAP EPS $1.15 (vs. $1.10 prior year). Adjusted EBITDA $259M, up 1.6% YoY.
- **Cost Savings**: $25M restructuring expenses in Q1, targeting $75-100M annual savings by end-2025. Operating margin improved 81bps (GAAP) and 14bps (Non-GAAP).
- **Guidance**: 2025 Non-GAAP EPS $4.80-$4.94, adjusted EBITDA mid-single-digit growth, sales 2%-4% YoY.
- **Cash Flow**: Q1 operating cash flow $37M, expecting full-year cash flow to exceed net income.

**【Q&A Key Themes】**
- **FX Impact**: Q1 headwind 1.5% from foreign exchange (euro weakness), neutral outlook for remainder of year.
- **Tariff Strategy**: No immediate price pass-through; working with suppliers to source alternatives, corporate brand products mitigate risk.
- **Market Trends**: Stable US dental distribution, strong equipment backlog, accelerating home solutions (23% growth, 9% internal).
- **DSO Activity**: Well-capitalized DSOs expanding, new practice build-outs increasing, equipment demand steady.
- **Implant Market**: US domestic market slightly down, but strong growth in Europe and Latin America, gaining share globally.


Henry Schein (HSIC)-5 May 25-2025 Q1 Earnings call transcript

- **Strategic Success**: 40%+ of profits from high-growth businesses, Home Solutions at $400M run rate, international dental up 7.3%.
- **Strong Q4 Earnings**: $1.19 EPS vs. $0.66 prior, 260bps non-GAAP margin expansion.
- **KKR Catalyst**: Largest shareholder with strategic advisory role, targeting 2026+ growth.
- **2025 Outlook**: 2-4% sales growth, $4.80-$4.94 EPS, offsetting IT costs with $75M+ restructuring savings.
- **Risks**: Digital pricing pressure, ortho patent expiration, flu season timing.


**【CEO Summary Section】**
- **Strategic Milestone Achievement**: Exceeded 40% of operating income from high-growth, high-margin businesses, with over half of profits now from premium products and services.
- **Organizational Restructuring**: Appointed Andrea Albertini and Tom Popeck to lead Global Distribution & Technology and Specialty Products, respectively, to drive synergies across dental, medical, and technology segments.
- **Market Performance**: U.S. dental equipment sales grew double-digit, international dental merchandise up 7.3%, and Home Solutions reached $400M annual run rate post-Acentus acquisition.
- **2025 Outlook**: Positioning 2025 as a base year for high single-digit to low double-digit EPS growth, supported by restructuring savings ($75M-$100M) and strategic investments in e-commerce and AI.

**【CFO Financial Commentary】**
- **Q4 2024 Results**: Total sales $3.2B (+5.8% YoY), non-GAAP net income $149M ($1.19 EPS), up 42% YoY. GAAP operating margin improved 358bps to 4.86%, non-GAAP margin 7.46% (+260bps).
- **Profitability Drivers**: Gross margin expansion from acquisitions, $37M restructuring costs, and $40M cyber insurance proceeds.
- **2025 Guidance**: Sales +2-4%, non-GAAP EPS $4.80-$4.94 (+1-4%), adjusted EBITDA mid-single-digit growth. Challenges include IT platform depreciation and normalized incentive compensation.

**【Q&A Key Highlights】**
- **Market Growth Assumptions**: 0-2% dental market growth, 4% medical, with focus on share gains via value-priced products and new tech solutions.
- **Margin Pressures**: Digital equipment pricing declines offset by unit growth, medical flu season timing variability.
- **KKR Partnership**: KKR to provide strategic advisory support post-Hart-Scott-Rodino clearance, targeting 2026+ growth acceleration.
- **Risks**: Tariff exposure limited to gloves (shifted to Vietnam), orthodontic patent expiration impacting Q4 margins but new product pipeline building.


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