Abstract

Zimmer Biomet will release its first-quarter 2026 results on April 28, 2026 Pre-Market, with consensus modeling pointing to year-over-year growth in revenue and adjusted EPS as investors weigh execution on commercial changes and product cadence against margin durability and ratings skewed toward caution.

Market Forecast

Based on the company’s latest modeling, the current quarter is projected at 2.07 billion US dollars in revenue, up 9.21% year over year, with adjusted EPS of 1.86, up 5.33% year over year; EBIT is projected at 522.64 million US dollars, up 5.12% year over year. Forecasts for gross margin or net margin were not provided alongside the revenue and EPS estimates.

Within the portfolio, reconstructive products remain the anchor with last quarter’s mix and pricing holding steady into the quarter, while the U.S. commercial transformation is the key execution variable for near-term growth rhythm. Knees is positioned as the most promising near-term segment, contributing 911.00 million US dollars last quarter; though segment-level year-over-year growth was not disclosed, the consolidated revenue outlook implies healthy underlying demand.

Last Quarter Review

Zimmer Biomet delivered fourth-quarter 2025 revenue of 2.24 billion US dollars, gross profit margin of 64.55%, GAAP net income attributable to shareholders of 139.00 million US dollars, net profit margin of 6.21%, and adjusted EPS of 2.42; revenue grew 10.90% year over year and adjusted EPS increased 4.76% year over year. The company modestly exceeded consensus on both revenue and adjusted EPS, and maintained operating discipline despite cost headwinds.

Product mix remained balanced: Knees contributed 911.00 million US dollars, Hips 555.40 million US dollars, Surgical/Sports Medicine/Biologics/Foot & Ankle/Extremities and Trauma totaled 587.60 million US dollars, and Other was 189.80 million US dollars, with total reconstructive (Knees + Hips) at 1.47 billion US dollars supporting overall growth momentum.

Current Quarter Outlook

Core reconstructive franchises

Q1 2026 is set up with consolidated revenue modeled at 2.07 billion US dollars, up 9.21% year over year, implying healthy procedure activity and stable pricing in core Knees and Hips. The large reconstructive base—1.47 billion US dollars last quarter for Knees and Hips combined—provides volume leverage, but also raises the bar for execution as the company cycles a strong Q4. Given the high absolute contribution from Knees (911.00 million US dollars last quarter), even modest volume swings can have an outsized effect on quarterly revenue and operating profit. Execution on case coverage, surgeon engagement, and hospital account stabilization under the U.S. sales force transformation is the primary swing factor for achieving or exceeding the mid-to-high single-digit growth implied by the consolidated forecast. The EBIT estimate of 522.64 million US dollars, up 5.12% year over year, suggests the company is prioritizing sustained operating efficiency while absorbing commercial investments tied to the transition.

Pricing dynamics in reconstructive should remain generally steady near term, as Q4’s 64.55% gross margin provides some cushion entering the year; however, incremental mix shift between Knees and Hips can nudge margin trajectories within the quarter. Knees tends to drive higher absolute dollars and remains a focal point for new technology attach, which can help preserve mix and pricing. Hospital capital and scheduling cadence in early-year months can create modest intra-quarter variability, but the year-over-year growth outlook indicates demand resilience for Q1. With the net profit margin exiting Q4 at 6.21%, the path to the quarter’s EPS profile of 1.86 assumes continued cost control and limited disruption from the commercial reorganization.

Largest growth opportunity: S.E.T. and digital enablement

The Surgical/Sports Medicine/Biologics/Foot & Ankle/Extremities and Trauma category delivered 587.60 million US dollars in Q4 2025, and remains the most leverageable platform for incremental growth alongside reconstructive. The cadence of portfolio refresh and digital integration is notable: recognition in late March for innovations spanning infection mitigation and AI-enabled post-op recovery underscores a broader push to pair implants with data and decision support. Such combinations can deepen surgeon adoption and support pull-through across procedure types when they create measurable benefits in efficiency or outcomes, even if segment-level year-over-year growth rates are not separately disclosed.

In Q1 2026, the combination of procedure normalization in sports medicine, steady trauma volumes, and selective premiumization in biologics supports a constructive setup for S.E.T. The scale of this segment gives it scope to contribute meaningfully to aggregate growth even with mid-single-digit progress, while also diversifying the revenue base from reconstructive cyclicality. Although the company has not provided a gross margin forecast for the quarter, S.E.T. mix improvement can help sustain consolidated margin if attach rates for enabling technologies and premium implants expand. Execution focus includes ensuring product availability, leveraging sales training to articulate the value proposition of newer solutions, and tightening alignment with high-volume centers to capture early-year procedure windows.

Key stock-price swing factors this quarter

The top variable for the stock into the print is the pace and quality of the U.S. commercial transformation, which several sell-side previews flagged as a double-edged catalyst: it can seed durable growth, but near-term friction could modestly temper order flow or mix in select geographies. Any commentary on case coverage stability, rep productivity, and pipeline conversion times will be dissected for signals on the Q2 ramp. The second swing factor is margin sustainability: with Q4 gross margin at 64.55% and a Q1 revenue growth outlook of 9.21% year over year, investors will parse whether operating expense growth tied to salesforce and digital investments is pacing below revenue growth so that EBIT and EPS can track the 5.12% and 5.33% year-over-year increases implied by current models.

A third focus is product cadence and innovation adoption, particularly in reconstructive and S.E.T., where recognized advances in infection mitigation and AI-assisted recovery can anchor premium mix. Uptake anecdotes, backorder status, and any supply-chain updates can shape near-term revenue quality perceptions. Lastly, signaling on capital deployment—including the decision to keep the quarterly dividend at 0.24 US dollars per share for the April 30 payment—frames return-of-capital consistency; while not the core driver of the Q1 print, it complements the earnings durability narrative if execution aligns with revenue and EPS trajectories.

Analyst Opinions

Across ratings and previews published since January 1, 2026, the balance of explicit stances skews bearish relative to bullish calls: Sell ratings from two major institutions outweigh a single active Buy during the period, with multiple Neutral and Market Perform stances in the mix, implying a bullish-to-bearish ratio of approximately 1:2. Under that distribution, the majority view is cautious, and those institutions emphasize execution and market-share risk factors into the quarter.

UBS reiterated a Sell stance with a price target in the mid-80s, highlighting concerns that near-term execution on the U.S. sales reorganization could introduce friction to order capture and case coverage, thereby making it difficult to compound Q4’s momentum immediately in Q1. Their work implies that while consolidated revenue is set to rise year over year in Q1 2026, the slope of improvement could be constrained by temporary channel and staffing adjustments that often accompany large-scale commercial changes. They also flag valuation sensitivity to margins: with Q4’s net profit margin at 6.21%, modest deleverage from incremental commercial spending could cap EPS upside relative to the 1.86 consensus, even if revenue lands near the 2.07 billion US dollars mark.

Goldman Sachs maintained a Sell rating while nudging its price target to the high 80s, pointing to a similar set of near-term hurdles: competitive intensity in core procedures, a still-evolving technology attach landscape, and the possibility that a measured rollout of commercial changes delays the full benefit to revenue growth until later in the year. The firm’s stance effectively sets a higher bar for Q1 commentary, looking for evidence that salesforce productivity metrics, win rates in targeted accounts, and backlog conversion are tracking ahead of internal pacing. From a model perspective, they frame the EBIT estimate of 522.64 million US dollars as achievable but not trivial if gross margin mix tilts toward value-priced constructs or if price/mix benefits are partially offset by investments in training and deployment for the reorganized field force.

The bearish cohort also notes that consensus may already embed a degree of optimism on year-over-year growth given the relatively tough comparison from Q4 2025’s 10.90% revenue increase. Translation of that prior momentum into Q1 is not automatic: early-year scheduling patterns can be uneven, and the push-pull between rebuilding relationship depth in restructured territories and expanding adoption of new solutions could cause mild volatility in monthly booking patterns. Consequently, bears argue that while the medium-term opportunity tied to commercial upgrades and portfolio innovation appears intact, the near-term risk-reward is balanced by the prospect of an in-line quarter with limited upward revision to full-year guardrails absent clearer signals on margin expansion.

Those emphasizing caution are watching three checkpoints on April 28, 2026. First, confirmation that revenue growth landed at or above the 9.21% year-over-year pace implied by current models, with color on Knees and Hips volumes, even if segment-level growth rates are not formally disclosed. Second, expense pacing versus the run-rate required to deliver the modeled 5.12% EBIT growth and 5.33% EPS growth, ensuring that operating leverage is preserved despite ongoing commercial investments. Third, narrative clarity on how the sales transformation milestones translate into lead indicators—case wins, account retention metrics, and funnel velocity—that could underpin a more constructive stance for subsequent quarters. If these elements align positively, the bearish camp acknowledges its case weakens; if they are mixed or ambiguous, the majority view expects volatility to be managed on guidance and margin commentary rather than through outsized beats.

In sum, the prevailing institutional tone heading into April 28, 2026 is measured and leans bearish, centering on near-term execution risks and the need for clear evidence that commercial resets and product differentiation can flow through to sustained margin and EPS expansion. The quarter’s numeric scaffolding—a 2.07 billion US dollars revenue estimate, 1.86 adjusted EPS, and 522.64 million US dollars EBIT—all with mid-single- to high-single-digit year-over-year growth—sets a constructive baseline; the debate is about momentum carry-through, cost discipline, and the timing of benefits from strategic changes. The majority view frames those questions as still to be answered in the immediate term, and it will benchmark management’s commentary and Q1 print against that lens.