[Management View]
Artivion reported strong Q2 2025 results, achieving double-digit growth in both revenue and adjusted EBITDA. Total revenue reached $113 million, representing 14% constant currency growth year-over-year, while adjusted EBITDA grew 33% to $24.8 million. Key drivers included robust performance in the On-X valve segment (24% YoY growth) and stent grafts (22% YoY growth). The company also made significant progress in its U.S. launch of AMDS, citing early clinical demand and cross-selling benefits. Management emphasized its innovation-driven growth strategy and pipeline execution, including FDA IDE approval for the Arecibo LSA pivotal trial.

[Outlook]
Artivion raised its full-year 2025 revenue guidance to $435–$443 million, reflecting constant currency growth of 12–14%. Adjusted EBITDA guidance was also increased to $86–$91 million, with expectations of a 200 basis point margin expansion. The company anticipates continued sequential growth in AMDS revenues and normalization of tissue processing backlog in Q3. Long-term growth catalysts include the NexSys PMA approval timeline for 2026 and the Arecibo LSA pivotal trial launch by year-end.

[Financial Performance]
Artivion delivered strong YoY growth across key metrics:
- Revenue: $113 million (+14% YoY)
- Adjusted EBITDA: $24.8 million (+33% YoY)
- Non-GAAP gross margin: 65.1% (+50 basis points YoY)
- Free cash flow: $11.7 million generated
The company also improved its net leverage ratio to 2.2, down from 4.1 in the prior year, after retiring $100 million of convertible debt.

[Q&A Highlights]
Question 1: Can you provide updates on AMDS adoption metrics and cross-selling benefits?
Answer: Management noted that the pipeline of hospitals seeking IRB and VAC approvals continues to grow, surpassing last quarter's metrics. AMDS training sessions have facilitated cross-selling opportunities, with surgeons adopting On-X valves immediately after training. Approximately 1,000 U.S. centers perform acute type A dissection surgeries, with 600 being top-priority accounts.

Question 2: What factors influenced the updated guidance for 2025?
Answer: The guidance increase reflects Q2 outperformance, stronger-than-expected currency dynamics, and robust underlying growth. Constant currency revenue growth expectations were raised to 12–14%, driven by AMDS and On-X performance.

Question 3: How are physicians adopting AMDS, and what feedback have you received?
Answer: Physicians are integrating AMDS quickly due to its simplicity and effectiveness in addressing malperfusion. Training is straightforward, and the device has shown immediate clinical benefits, such as restoring blood flow in critical cases.

Question 4: Are there plans to expand the commercial team for AMDS?
Answer: The current 55-person team is focused on the top 600 centers. Expansion to cover additional accounts may be considered in the second phase of the launch, but no immediate changes are planned.

Question 5: What are the next steps for the Arecibo LSA pivotal trial?
Answer: The trial will enroll 132 patients across up to 30 sites, with the first patient expected by year-end. Preparations include hospital contracts, IRB approvals, and device sterilization.

Question 6: How does the AMDS launch impact gross margin and EBITDA?
Answer: AMDS is a high-margin product sold through the existing salesforce, contributing to gross margin expansion (+50 basis points in Q2) and future EBITDA growth.

Question 7: What drives On-X valve growth, and what is embedded in the guidance?
Answer: On-X growth is fueled by low INR indications, cross-selling from AMDS, and new clinical data showing mortality benefits for patients under 60. The guidance reflects robust performance across all product lines.

Question 8: Are there any pricing trends or changes in pricing power?
Answer: Artivion continues to implement modest inflationary price increases without facing significant price pressure, given the lifesaving nature of its products.

Question 9: How should investors view free cash flow for the remainder of 2025?
Answer: Management expects positive free cash flow for the full year, with Q2 performance catching up from Q1 timing fluctuations.

[Sentiment Analysis]
Analysts expressed positive sentiment, highlighting strong execution in AMDS adoption, On-X growth, and pipeline advancements. Management maintained a confident tone, emphasizing sustainable double-digit growth and robust financial health.

[Quarterly Comparison]
| Metric | Q2 2025 | Q2 2024 | YoY Change |
|-------------------------|-----------------|-----------------|------------------|
| Revenue | $113M | $99M | +14% |
| Adjusted EBITDA | $24.8M | $18.6M | +33% |
| Non-GAAP Gross Margin | 65.1% | 64.6% | +50 basis points |
| Free Cash Flow | $11.7M | $8.5M | +37.6% |
| Net Leverage Ratio | 2.2 | 4.1 | -1.9 |

[Risks and Concerns]
1. Regulatory hurdles: FDA approvals for pipeline products like NexSys and Arecibo LSA remain critical for future growth.
2. Competitive landscape: Limited alternatives for AMDS and On-X provide an advantage, but new entrants could pose risks.
3. Operational challenges: Scaling AMDS adoption across 1,000 U.S. centers requires sustained execution and resource allocation.

[Final Takeaway]
Artivion delivered a strong Q2 2025 performance, driven by innovation in its product portfolio and strategic pipeline execution. The AMDS U.S. launch is gaining traction, with cross-selling benefits boosting On-X valve adoption. Raised guidance reflects confidence in sustained growth, supported by robust financial metrics and clinical advancements. While regulatory and operational risks remain, the company is well-positioned to capitalize on its differentiated offerings and expand its market presence.