Artivion, Inc. (NYSE:AORT) Q4 2025 Earnings Call Transcript

Artivion, Inc. (NYSE:AORT) Q4 2025 Earnings Call Transcript February 12, 2026

Artivion, Inc. misses on earnings expectations. Reported EPS is $0.05 EPS, expectations were $0.14.

Operator: Good afternoon, and welcome to the Artivion, Inc. Fourth Quarter and Year End 2025 Earnings Call. At this time, all participants are in a listen-only mode. If anyone should require operator assistance during the conference, please press. As a reminder, this conference is being recorded. I will now turn the conference over to Lane Morgan from the Gilmartin Group. Thank you. You may begin. Thanks, Operator. Good afternoon, and thank you for joining the call today. Joining me today from Artivion, Inc. management team are Pat Mackin, CEO, and Lance A. Berry, COO and CFO. Before we begin, I would like to make the following statements to comply with the safe harbor requirements of the Private Securities Litigation Reform Act of 1995.

Comments made on this call that look forward in time involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements made as to the company’s or management’s intentions, hopes, beliefs, expectations, or predictions of the future. These forward-looking statements are subject to a number of risks, uncertainties, estimates, and assumptions that may cause actual results to differ materially from these forward-looking statements. Additional information concerning certain risks and uncertainties that may impact these forward-looking statements is contained from time to time in the company’s SEC filings and in the press release that was issued earlier today.

You can also find a brief presentation with details highlighted on today’s call on the investor relations section of the Artivion, Inc. website. Lastly, I would like to remind you to please refer to our press release published earlier today for information regarding our non-GAAP results, including a reconciliation of these results to our GAAP results. Unless otherwise stated, all of our comments today will be using our non-GAAP results. Additionally, all percentage changes discussed will be on a year-over-year basis. Revenue growth rates will be the adjusted constant currency rates, and expenses as percent of sales will be based on adjusted revenue. I will now turn the call over to Pat Mackin.

Pat Mackin: Thanks, Lane, and good afternoon, everybody. 2025 was a highly successful year for Artivion, Inc., during which our team made meaningful progress against our strategy designed to drive long-term profitable growth through our expanding and clinically differentiated product portfolio. I am pleased to report that for the full year of 2025, total adjusted constant currency revenue growth was 13%, and adjusted EBITDA growth was 26% year over year. This enabled us to deliver positive free cash flow for the year while also investing significantly in future growth and operational excellence. Our progress through the year culminated in a strong fourth quarter, performance driven by continued growth across our entire product portfolio led by stent grafts and On-X.

As a reminder, during 2024, stent graft and preservation services businesses were negatively impacted by the cybersecurity incident. With that in mind, from a product category perspective, stent grafts grew 36% on a constant currency basis in the fourth quarter compared to the same period last year. Year-over-year growth was again driven in large part by AMDS in the U.S., continued strong growth in stent grafts internationally, as well as an easier year-over-year comp due to last year’s cyber incident. We see our stent graft portfolio as a foundational component of our growth, and we are encouraged by the continued strong results across the portfolio. Looking ahead, we intend to replicate our proven strategy by bringing additional stent graft products already generating revenue in Europe to the U.S. and Japan, which we believe will unlock further meaningful expansion of our stent graft total addressable market.

Also in Q4, our On-X revenues grew 24% year over year on a constant currency basis. Growth was driven by our continued global market share gains and early traction in our new $100 million U.S. market opportunity unlocked by recently published data. As previously discussed, the clinical evidence supported by two leading journals demonstrated improved outcomes with mechanical versus bioprosthetic valves for younger patients. As a result, we maintain a strong conviction that On-X is the best aortic valve on the market for patients 65 that will continue to take market share worldwide in that product line. In Q4, tissue processing revenue, which was the category most heavily impacted by last year’s cybersecurity event, increased 6% year over year on a constant currency basis.

Lastly, BioGlue was relatively flat on a constant currency basis compared to the same period last year. As we have discussed previously, we expect to see some variability in the growth rates of BioGlue quarter over quarter driven by the significant amount of stocking distributor business in that product line. In addition to our strong financial performance, we continue to advance our clinical programs and pipeline. Recently, in January, we saw positive new clinical data from the AMDS PERSEVERE and NEXUS TRIUMPH trials presented at the STS annual meeting in New Orleans. First, the two-year data for AMDS PERSEVERE trial demonstrates continued clinical benefit of AMDS after one year, including minimal additional mortality and morbidity, no additional unanticipated aortic reoperations, and the continued absence of DANE tears.

These data build on the positive findings from the 30-day and one-year readouts, further supporting the life-saving nature of the AMDS technology, which represents our nearest-term PMA opportunity. While the HDE enables us to sell AMDS in the U.S. ahead of the PMA approval, we remain focused on securing the PMA for AMDS. We are pleased to report that we recently filed the fourth and final module with the FDA, keeping us on track for FDA approval in mid-2026. Second, our partner EndoSpan presented one-year data from the U.S. IDE trial for its NEXUS aortic arch stent graft system. This trial is the first FDA IDE trial for the endovascular treatment of chronic dissections in the aortic arch and is focused on patients at high risk for open surgery.

The data highlighted 94% of patient survival from lesion-related death, and 91% of patients were free from stroke at one year post treatment in this high-risk patient group. The data also showed 97% of patients were free from renal reinterventions due to endoleaks. In our discussions with physicians at STS, surgeons generally expressed that they believed the one-year results were extremely promising. Based on these positive outcomes, we believe NEXUS remains on track for approval in 2026. Lastly, on our pipeline, we continue to make progress on the ARTISAN trial for our Arecibo LSA product. We now have eight patients enrolled in our trial, which is a nonrandomized clinical trial consisting of 132 patients in the U.S. and at up to 30 centers for treatment of aortic dissection and aneurysm.

The combined primary safety and efficacy endpoints assess the reduction in all-cause mortality, new permanent disabling stroke, new permanent paraplegia or paraparesis, unanticipated aortic reoperation in the treated segment, and left subclavian artery occlusion. We anticipate completing the full enrollment in mid-2027. We are optimistic that the trial will be successful, supported by the positive clinical results from our current generation frozen elephant trunk, E-vita Open Neo, outside the U.S. Following our one-year follow-up period, we are assuming that the trial meets its endpoint. We anticipate FDA approval for our Arecibo LSA in 2029, unlocking an incremental $80 million in annual U.S. market opportunity. In conclusion, 2025 was a standout year for Artivion, Inc., and our strong financial, clinical, and regulatory execution positions us well for continued growth in 2026 and beyond.

We remain confident in our ability to deliver sustainable double-digit revenue growth, drive EBITDA margin expansion, and grow adjusted EBITDA at twice the rate of constant currency revenue growth over the long term. I will now turn the call over to Lance A. Berry.

Lance A. Berry: Thanks, Pat, and good afternoon, everyone. Before I begin, I would like to remind you to please refer to our press release published earlier today for information regarding our non-GAAP results, including a reconciliation of these results to our GAAP results. Additionally, all percentage changes discussed will be on a year-over-year basis and revenue growth rates will be in adjusted constant currency unless otherwise noted. Total adjusted revenues were $118.3 million for Q4 2025, excluding the Italian payback adjustment, up 18.5% compared to 2024. Meanwhile, adjusted EBITDA increased approximately 29% from $17.6 million to $22.7 million in Q4 2025. Adjusted EBITDA margin was 19.2% in Q4 2025, approximately 110 basis point improvement over the prior year driven by leverage in SG&A.

For the full year, total adjusted revenues were $443.6 million, up 13% compared to full year 2024. Adjusted EBITDA grew 26% for the full year, twice the rate of adjusted revenue growth. This resulted in adjusted EBITDA margin of 20.2%, a 190 basis point improvement from 2024. Before I do a detailed review of our results, I would like to comment on the impact of the Italian government’s payback legislation to our 2025 financials. You may be familiar with this as it impacts a number of medical device companies. In 2015, the Italian government passed legislation requiring medical device companies that supply goods and services to public Italian hospitals to pay back a portion of their revenue when regional health care spend exceeds budgets. The applicability of this law was subject to extended legal proceedings, and after years of litigation, the Italian government proposed a settlement for fiscal years 2015 through 2018 which became effective in 2025.

The impact on us for those fiscal years was minimal. Subsequently, to address the ongoing impact of the law in years after 2018, during the fourth quarter, we recorded a $2.3 million adjustment to revenue for the estimated payback obligations for fiscal years 2019 through 2025, which has been excluded from our fourth quarter and full year adjusted revenue. I want to highlight that while we are subject to this law after 2025, the quarterly impact is expected to be immaterial compared to this cumulative adjustment for 2019 through 2025. We do not expect to adjust for this payback moving forward, unless there are significant changes to prior period estimates. To further contextualize our underlying fourth quarter performance, I will provide additional details on our results excluding the impact of the 2024 cybersecurity incident.

As previously disclosed, the incident had a negative impact of approximately $4.5 million on Q4 2024 revenue, approximately $2.0 million in stent grafts, and approximately $2.5 million in tissue processing. As a result, we estimate that our underlying business grew 13% for Q4 2025, adjusted for impacts associated with the cyber incident and Italian payback. With that, I will now move on to our Q4 results. From a product line perspective, stent graft revenues increased 36%, On-X grew 24%, tissue processing revenues grew 6% in Q4 2025. As previously discussed, the cyber incident primarily impacted our stent graft and tissue processing revenues. Excluding the previously discussed impact of the cyber incident from our prior year results, our fourth quarter stent graft revenues increased 28%, and our tissue processing revenues declined 4%.

I would like to note that tissue processing growth for the full year declined 3% compared to 2024. This came in below our expectations, driven primarily by the lingering impact of the cybersecurity incident in Q1. Moving now to our regional performance. Revenues in Asia Pacific increased 32%, North America increased 18%, EMEA increased 17%, and Latin America increased 9%, all compared to Q4 2024. Q4 gross margins were 63% in both 2025 and 2024. As a reminder, the 2024 gross margin was negatively impacted by approximately two percentage points by an idle plant charge due to the cyber incident. The 2025 gross margin was negatively impacted by roughly one percentage point from the Italian payback adjustment and was also impacted by certain manufacturing inefficiencies that we do not anticipate to repeat in 2026.

General, administrative, and marketing expenses in the fourth quarter were $56.8 million compared to $51.4 million in 2024. Non-GAAP general, administrative, and marketing expenses were $53.5 million or 45.2% of sales in the fourth quarter compared to $47.5 million or 48.8% of sales in 2024, reflecting a 360 basis point improvement. Approximately 200 basis points were driven through leveraging existing infrastructure; approximately 160 basis points were from stock-based compensation. Our as-reported expenses included a gain of approximately $2.9 million in Q4 associated with the cybersecurity incident, which are excluded from adjusted EBITDA, reflecting a $3.2 million insurance reimbursement for costs we incurred in previous periods. R&D expenses for the fourth quarter were $9.1 million or 7.7% of sales compared to $7.4 million or 7.6% of sales in 2024, and as expected, an uptick in spending from previous quarters this year due to the start of the ARTISAN clinical trial.

Interest expense, net of interest income, was $5.2 million as compared to $9.4 million in the prior year. Other income and expense this quarter included a nominal amount of foreign currency translation losses. Free cash flow for the full year was above expectations, coming in at approximately $1 million despite continued investments in our business, including one-time cash payments of approximately $20 million related to the previously disclosed purchase of two Austin facilities in the fourth quarter. We previously anticipated one of the buildings closing in Q1 2026, but we were able to accelerate that close to Q4. As of 12/31/2025, we had approximately $64.9 million in cash and $215.1 million in debt, net of $4.9 million of unamortized loan origination cost.

At the end of the fourth quarter, our net leverage ratio was 1.8, down from 3.8 in the prior year. And now for our outlook for 2026. Please note that this outlook excludes any impact from the potential acquisition of EndoSpan. We expect constant currency growth between 10% to 14% for the full year 2026, representing a reported revenue range of $486 million to $504 million. This guidance contemplates FX to have an insignificant impact on our as-reported revenue for the full year. On a segment basis, we expect similar business dynamics to be in place in 2026 as there were in 2025 with a few items to note. First, we will be in year two of the AMDS launch, resulting in more difficult comps as the year progresses. Second, our tissue business fluctuated a fair amount quarter to quarter due to the impacts of the cyber event.

Overall, the business was relatively flat for the full year, and at this point, we feel it is prudent from a planning perspective to assume that this business will remain flat in 2026. Given these factors, we expect full year 2026 tissue revenue to be relatively flat compared to the full year 2025, BioGlue growth to be in the mid-single digits, On-X growth rates to be in the mid-teens, and stent graft growth rates to be in the low twenties. As it relates to quarterly cadence, we expect growth in Q1 2026 to outweigh growth in the rest of the year. This is driven by an easier Q1 comparison due to lingering revenue impact in Q1 2025 from the cybersecurity incident, tougher comps in the second and third quarters due to the recovery of the tissue backlog, and tougher On-X and AMDS comps starting in Q2.

Altogether, this results in Q1 constant currency growth rate towards the high end of our full year range with lower constant currency growth rates for the remaining quarters, and we expect the second through fourth quarters to have fairly similar constant currency revenue growth rates. With our continued top line revenue growth and general expense management, we expect full year 2026 adjusted EBITDA to be in the range of $105 million to $110 million, representing a range of 18% to 22% growth over 2025 and approximately 150 basis points of adjusted EBITDA margin expansion at the midpoint of our ranges. Additionally, we expect gross margins to improve by approximately 50 basis points driven by mix benefit from U.S. AMDS and U.S. On-X sales growth.

We also expect approximately 200 basis points of leverage from SG&A, partially offset by an expected 100 basis point increase in R&D as a percentage of sales. Altogether, this results in EBITDA growth at the midpoint of our range that is slightly below our target of 2x our revenue growth rate. The primary driver of this is an increase in R&D spend from 7% of sales in 2025, which is at the low end of our targeted range, to approximately 8% in 2026, which is at the high end of our targeted range. This is driven primarily due to timing; we had minimal clinical trial expenses in 2025 and expect a full year of ARTISAN trial-related expenses in 2026. Although there will be some variation in R&D as a percentage of sales from year to year, we do not expect it to be this significant going forward.

On interest expense, we expect 2026 to be more consistent with our fourth quarter exit rate following the midyear 2025 refinancing. We also expect free cash flow to be slightly positive for the full year 2026. Lastly, we expect CapEx to be approximately $50 million in 2026, up from $39 million in 2025. We see a long run rate for On-X growth globally, based on the growing body of clinical evidence supporting the use of mechanical valves in younger patients and On-X’s differentiated low INR indication. Accordingly, we are investing in facilities, equipment, and systems to ensure we can efficiently support that growth over the long term, resulting in elevated CapEx in 2025 and 2026. In general, our business is not capital intensive, and we expect CapEx to moderate in subsequent years.

In summary, we are pleased about our 2025 performance and are excited about the prospects of the business in 2026 and beyond. With that, I will turn the call back to Pat for his closing comments.

Pat Mackin: Thanks, Lance. We are very pleased with our 2025 performance and our position entering 2026, which reinforces our confidence our growth strategy is working and delivering the results we envision. More specifically, we expect future growth to be driven by the following key growth drivers. First, AMDS HDE. We are commercializing AMDS in the U.S. and continue to penetrate the $150 million annual U.S. market opportunity with new clinical data and reimbursement dynamics likely adding as a further tailwind. Number two, On-X heart valve data. We are educating health care providers on the new clinical data showing a mortality and reoperation benefit in patients 65 years of age compared to bioprosthetic valves. This is a new $100 million annual U.S. market that we will be pursuing with the only mechanical aortic valve that can be maintained at a low INR of 1.5 to 2.0. Number three, the NEXUS PMA.

We are pleased with the positive new one-year clinical data from the NEXUS TRIUMPH trial which we believe, assuming we exercise our option to acquire EndoSpan, will bring us one step closer to being able to access the annual market opportunity for this device of $150 million. And fourth, the ARTISAN IDE trial. We continue to make progress on our third-generation frozen elephant trunk called Arecibo LSA in the clinical trial, which represents an incremental $80 million annual U.S. market opportunity. Finally, I want to thank all our employees around the globe for their continued dedication to our mission of being a leading partner to surgeons focused on aortic disease. With that, Operator, please open the lines for questions.

Q&A Session

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary. One moment please while we poll for questions. Our first question comes from William John Plovanic with Canaccord Genuity. Please proceed with your question.

Lance A. Berry: Yeah. Great. Thanks for taking my question. You know, I think what I am trying to get my head around is just the Italian clawback, obviously, kind of skews the numbers a little. So, my questions are going to roll around that as you know, first is I assume that is in OUS, not U.S. Like, because your U.S. growth was in the high teens. I assume that was hit by the preservation service growth. But I am trying to figure out, you know, did it flow through any specific products. Kind of how did it, it sounds like it also impacted the P&L. And then I think what I am really trying to get at, you know, given the growth rate year over year, I think the U.S. was a little lower than what we would have expected, you know, given how strong the stent graft business was.

And I am trying to know, it goes into the AMDS question on sell-in versus sell-through there. I know there is a lot in that, but I am, it kind of the Italian stuff kind of might be throwing some of the numbers off. So, yeah, Bill, let me maybe try and clear up some of the details around the Italian payback. So first of all, yes, it was in OUS, specifically in the EMEA line. Second, it was reported in other line item of revenue, so it did not impact any of the big four line items. So it is not skewing that growth rate that we discussed in any way, shape, or form. So hopefully, that is helpful. And then if you look at the U.S., you know, really, honestly, if you just step back and look at the growth rates, you know, for the business from Q3 to Q4, we almost, whatever you are looking at, the main difference is just the tissue business.

And that business, if you take out the impact of the easy comp of the cybersecurity event, the growth rate was quite a bit lower in Q4 versus Q3. Okay. And then just really kind of the final thing is just any commentary you can provide on the sell-in versus sell-through on the AMDS and, you know, I mean, you lifted expect continued guidance, I think, well above our expectations on the AMDS and On-X. So, you know, that is a good trend, but I am just, you know, a lot of people are focused on this. Yeah. So

Pat Mackin: We typically do not break out the details on AMDS even in total for revenue. And so, you know, we also do not break out the details on the new account start-ups as opposed to the actual implantations. Other than, I think, we will say the implantations are continuing to grow, and they are continuing to go really well. I think, again, I have said this a lot of times that, you know, it is just important that that first experience for a surgeon is a good one. And so far, that has been going really, really well.

Lance A. Berry: Great. Thanks for taking my questions.

Operator: Our next question comes from John Glenn McAulay with Stifel. Please proceed with your question.

Lance A. Berry: Hi, Pat and Lance.

Pat Mackin: Wanted to start off back where Bill was on AMDS. Very helpful color on just how the year plays out. Just was hoping for a little more color in the sense of how much is left to go here. Earlier last year, I think you mentioned target accounts and accounts that you were in at that point. How much progress have you made on that front? And what should we be expecting as 2026 plays out? And you gain the full FDA approval?

Lance A. Berry: Yeah, Lance. I will take that. You know, so I think it is important. It is a good question. Right? If you want to make the analogy to, like, baseball, you know, like, we are in the first inning. I mean, we launched the product not, you know, like, right about a year ago, had to go through all these value analysis committees that take six to nine months. So really, 2025 was the year of opening accounts, and we had implants. But we are already starting to see those accounts implanting. But we were probably only in 10% of the accounts. So, you know, in 2026, we have got the opportunity to continue to open new accounts, get implants in the accounts you already opened. Right? So I think it is very early for AMDS and, you know, that is why we are bullish on, you know, 2026 and driving the growth there. Yeah. That is very helpful, Pat. And

Pat Mackin: Just broadly on NEXUS, there is some impressive data coming out of STS. Just wanted to get your general reaction there and maybe help frame this market opportunity for us. Again, I believe there is an approved somewhat similar competitive device in this market. Can you talk about how big the market is today and what NEXUS can do to, one, help you gain share in that space and, two, help expand the market beyond its current size? Yeah. So you are correct. There is one product approved in the market. They got approval last, like, May or June. So this is kind of a nascent market. From my conversations with clinicians, I mean, this is a, you know, particularly the trial kind of showed that these are patients that were at very, very high risk of open surgery.

There is a category called ASA which kind of characterizes the risk of a patient with all the different comorbidities. And, you know, two-thirds of these patients, actually, like, 70% of these patients were ASA 3 and 4, which would tell you that most surgeons are not going to operate on these patients. I mean, a good analogy is, like, the early TAVR was started in patients who could not withstand surgery, and then all of a sudden, it started going other places. So we see this as a platform technology. We say that the U.S. market is $150 million. You know, it will take us some time to penetrate that. But it is a very unique technology, and we think we are extremely well positioned. I had a chance, saw the presentation. I think that this device will be very competitive in the U.S. market to the other player.

We think they are on track for a PMA approval in the second half. And, you know, this further goes to our focus in the aortic arch, whether it is AMDS or NEXUS or our ARTISAN trial with Arecibo LSA. So it is, you know, I think it just shows the company’s commitment to bringing aortic technologies to these surgeons so they can treat their patients. So I do think this is a first step in a very exciting new space. That is great. Thanks for taking my questions.

Operator: Our next question comes from Suraj Kalia with Oppenheimer. Please proceed with your question.

Lance A. Berry: I am not hearing anything. Are you there?

Operator: Okay. We will go to the next person then. Our next question will be from Joseph Conway with Oppenheimer. Please proceed with your question.

Lance A. Berry: Hey, Lance. Hey, Pat. This is Jacob on for Suraj here, actually. I guess, first off, could you talk to us about how you are thinking about pricing for AMDS? And by extension NEXUS? Have you seen relative price insensitivity of demand that your assumptions of $25,000 for AMDS and $50,000 for NEXUS are still seen as the right levels. Yeah. I think it is an important point. You know, these are cutting-edge life-saving therapies, first of their kind, that happen to come with a very favorable reimbursement background. So that is not something we see at all in this space. Got it. And then just on your guide, what are the assumptions of the 10% to 14% CAGR. How can we stress test the conditions for either end of that spectrum?

Well, I think it is, you know, if you look at kind of our history, I will let Lance chime in here in a second. But, you know, we have got, you know, he gave you pretty clear direction. You know, we think tissue is going to be, we are going to forecast tissue flat this year because we saw it last year, you know, a while to recover on the cyber. We are going to be prudent. We think BioGlue is going to grow by, you know, in the mid-single digit, and we think On-X is going to grow mid-teens, and we think stents are going to grow in low twenties. So those are the things that, particularly the On-X, I think half the portfolio, feel very comfortable with. We understand the tissue and the BioGlue. I think on the upside, how successful are we driving the On-X message into the marketplace?

And can we grow faster than that? And same with AMDS. You know, opening more accounts and getting more implants. Those are the two that can move you up very quickly, you know, above those ranges, which are going to drive the growth rate to the higher end of the range. Lance, do you want to comment

Pat Mackin: Yeah. No. I was going to say the same thing. You know, those are the two things that are our newest and are big opportunities and have a wider range of possible outcomes. And, you know, we are obviously going to be doing what we can to maximize both of them.

Lance A. Berry: Thank you.

Operator: Our next question comes from Frank Takkinen with Lake Street Capital Markets. Please proceed with your question.

Lance A. Berry: Hey, Lance. It is Pat Nelson on for Frank. Congrats on all the progress. Maybe just to start on, I wanted to ask about the DRG code that went live October 1. Any measurable acceleration in VAC approvals or shortening of the timeframe from IRB to first case. Just any color there would be helpful. Yeah. We were not seeing prior to the October 1 implementation of DRG 209, we were not seeing the economics as a barrier. Like, we were not, again, whether it, you know, helped accelerate things, I certainly think it makes it a much easier conversation. Although it was, I think hospitals were doing fine with the new DRG. So I think I would just say it is a tailwind for us. I do not know, Lance, do you have any thoughts?

Pat Mackin: Yeah. So I have yet to run into anything that significantly accelerates hospital bureaucracy. So I cannot wait for the day when it happens, but, you know, they have a lot of DRGs that they sift through and a lot of products, and their value analysis committee kind of, it moves at the pace that it moves. So, but, obviously, the new reimbursement is a great fact when we do get in front of the value committee, and I think it will be helpful when we get on the agenda.

Lance A. Berry: Got it. That is helpful. And then apologies if I missed it, but you mentioned last quarter that you have not launched a formal marketing program to cardiologists for On-X. Any sense of timing on that if you have not started that already, or how should we think about that as a potential lever on top of everything else you have going for you with On-X? Yeah. I think that gets back to the question that was asked by the previous person, right, which is your range of 10 to 14. The two things that stand to outperform are On-X and stents because it is really the biggest opportunity. You know, we see both of these as kind of five-year opportunities, and how fast we drive the adoption, you know, we will see. We are obviously going to do as aggressive as we can.

But, you know, there is a lot of cardiologists out there we have to educate. And we have got several programs in place to deliver the message to the cardiologist, the referring cardiologist. It will take time. And we will have a lot better sense this year as we start doing these programs and understand how many cardiology groups we get to and how the message resonates and how the growth rate moves forward. So, yeah, I am very optimistic because the market research, particularly on the On-X, when we talk to the referring cardiologists, these are the cardiologists that refer to the implanting surgeon. When we review the two papers that show a mortality and re-op benefit in patients under 65 for mechanical versus bioprosthetic, and we show them the On-X low INR data that nobody else has got, they were wildly positive, to the point where they are going to refer On-X valves by name, branded, which you do not see very often.

So, again, we are very excited. We just have to execute. And, you know, I think it is a multiyear program. But, you know, we will have a better grip as we kind of move through 2026. Helpful. Congrats, guys. Thank you.

Operator: Our next question comes from Mike Matson with Needham & Company. Please proceed with your question.

Pat Mackin: Yes.

Lance A. Berry: So I guess, starting with AMDS, you know, when you do get the PMA, do you expect that to have any impact on the growth at all? Like, would it maybe help a little? Or not make a difference? I mean, I think the real meaningful change is just the, you know, the main requirement of an HDE is you have got to get a local IRB at the hospital, which out of the blocks was a little confusing, but we figured it out. So it is just the administrative stuff. So that will go away. But we do not feel like it is going to meaningfully change. I mean, the opportunity is here with the HDE, it just gets rid of some of the red tape and bureaucracy of the IRB.

Pat Mackin: Okay. Got it. And then where do things stand with getting AMDS into Japan? I mean, looking at your slides, I think you were saying it is probably by the end of this year. So Japan typically pegs off the PMA. So, you know, that clock is going to start once we get the PMA in the U.S. You know? So we should have an update probably midyear on AMDS Japan once we get the PMA in the U.S. Okay. Alright. And then just for the CapEx, I think Lance said $50 million for this year? And that is a pretty big step up from what was already a pretty big step up last year. So is that all just really to support the capacity expansion for On-X?

Lance A. Berry: Yeah. I am going to say primarily the higher levels both years are primarily related to that. I would say also just, you know, we have upticked our own internal investment in IT systems to help drive better efficiency going forward than what we had done in the past. And I have told investors before that, you know, at the moment, if there is an opportunity where we can invest capital to either improve revenue or SG&A leverage, then I am really interested in doing that. And so a lot of it is Austin, but not all of it. And so I do think, you know, if you look into 2027, 2028, I would expect the CapEx to come down from where it is. I would not expect it to go back to where the historical levels were 2024 and previous, but I would expect it to come down meaningfully.

Lance A. Berry: Okay. Thank you.

Operator: As a reminder, if you would like to ask a question, please press. Our next question comes from Daniel Walker Stauder with JMP Securities. Please proceed with your question.

Lance A. Berry: Yes. Great. Thanks for the questions. So first one, just on On-X. Another really strong quarter. Wanted to ask if you are still seeing the same level of cross selling benefits with AMDS that you have mentioned in the past? And are there any trends you are seeing in terms of these newer surgeons and their On-X utilization? Just really trying to get at what you were seeing with some of these physicians that you added earlier in the year. Thanks. Yeah, no, I think we are expecting that to be an ongoing kind of benefit. Right? So if you think about it, you know, there is 1,000 centers in the U.S. that do a Type A dissection. They also do aortic valves. So, you know, we are not selling On-X valves to all 1,000 centers.

And for whatever reason, up to now, we had not had relationships with some of these surgeons. And they become interested in AMDS. They come to a training. The rep gets to know them, and then we show them the data. And I have had dinners with a number of these surgeons, and, you know, after the dinner conversation with the new data and the low INR and, you know, they go back and switch. So I think they kind of go hand in glove. Right? As we continue to open new AMDS accounts and continue to build relationships with these aortic surgeons, we are going to get the message out on On-X both to the surgeon as well as to the cardiologist. So I think that cross selling is going to be an ongoing thing for the next couple years as we continue to open up AMDS accounts.

Okay. Makes sense. That is helpful. Just one more from me. Focusing on NEXUS, you know, could you tell us a little bit more about the eventual commercial process here? Is it really just, you know, the same playbook as AMDS? Do you expect the training and learning curve could be more or less intensive? Any more color on specific nuances to the eventual NEXUS commercial rollout would be great. Thanks. Yeah. They are very, you know, they are very kind of opposite devices. If you look at on a continuum, AMDS is extremely easy. The training requirement is really, we can do it at a benchtop with a pig valve or, you know, pig heart. Every aortic surgeon can do it. The learning curve is like one case. It adds five minutes to the procedure. So that really is kind of like nirvana from a product launch because it is just so easy.

I would go to the other end of the spectrum in, you know, NEXUS is easy in that category. But these are highly trained vascular surgeons that are only in the biggest centers. So, you know, 1,000 centers, NEXUS is probably a couple hundred centers. There is going to be extensive training because it is all endovascular in the arch. It is, you know, the first device that has been trialed in chronic dissections. So I think there will definitely be more intensive training. We will have to cover every case with a rep. And so, you know, they are very different, I would say. And, you know, again, I think we are well prepared for it. In some ways, it makes it a lot easier because it is not as many centers. And those centers are going to do a lot of volume.

So, and they are all, like I said, highly trained, highly skilled vascular surgeons who are already kind of skilled in the art of doing this. So we just have to train them on how to use this technology. Okay. Great. That is great insight. Thanks a lot. Appreciate it.

Operator: Mr. Mackin, we have reached the end of our question and answer session. I would now like to turn the call back over to management for closing comments.

Lance A. Berry: Yes. Well, thanks for joining our Q4 call, and I hope you can hear in our voices. We are super excited about 2026. We think we have got a great opportunity to drive both our commercial business with the On-X on the new clinical data and AMDS with the new data. We think we are going to get the PMA for AMDS halfway through the year, and we think NEXUS is going to get their PMA in the second half. And we have got our trial enrolling on Arecibo, and we expect that to be our next PMA in 2029. So that is kind of our business model, which is a new PMA every two years to keep the double-digit growth and EBITDA twice as fast over the long term. So we appreciate your attention and support of the company. We look forward to the next call.

Operator: This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.