HAE — Haemonetics Corporation

Summary of Haemonetics Corporation Q2 2026 Earnings Call

1. Key Financial Results and Metrics

• Revenue: Q2 revenue was $327 million, reflecting a 5% reported decline. Year-to-date revenue reached $649 million, also down 5%. Excluding portfolio transitions, organic growth was 9% for the quarter and 11% year-to-date.
• Adjusted EPS: Increased by 13% to $1.27 in Q2 and by 11% to $2.36 year-to-date.
• Gross Margin: Adjusted gross margin improved to 60.5% in Q2, up 380 basis points year-over-year.
• Operating Cash Flow: Generated $111 million in Q2, a 128% increase year-over-year, and $129 million year-to-date, a sixfold increase compared to the previous year.
• Free Cash Flow: Reported at $89 million in Q2 and $91 million year-to-date, with a conversion ratio of 147% for the quarter.

2. Strategic Updates and Business Highlights

• Business Segments:
  • Hospital Revenue: $146 million in Q2, up 5% reported and 4% organic, driven by strong Blood Management Technologies growth (up 12%).
  • Plasma Revenue: $125 million in Q2, down 10% reported but up 19% organic excluding CSL, driven by share gains and innovation.
  • Blood Center Revenue: Declined 18% reported but grew 4% organically, benefiting from a focus on apheresis.
• Product Innovations: Launched the HN cartridge in EMEA and Japan, enhancing viscoelastic testing capabilities.
• Operational Improvements: Continued focus on cost management and productivity initiatives contributed to margin expansion.

3. Forward Guidance and Outlook

• Revenue Guidance: Full-year revenue guidance updated to a decline of 1% to 4% reported and an increase of 7% to 10% organic growth excluding CSL.
• Plasma Revenue Guidance: Expected decline of 4% to 7% reported, with 14% to 17% organic growth excluding CSL.
• Adjusted EPS Guidance: Raised to $4.80 to $5.00 per share.
• Free Cash Flow Guidance: Increased to $170 million to $210 million for the full year.

4. Bad News, Challenges, or Points of Concern

• Interventional Technologies: Experienced a decline of 5% in Q2 and 6% year-to-date, particularly impacted by softness in esophageal cooling.
• Blood Center Challenges: Reported revenue decline due to the whole blood divestiture, although organic growth remains positive.
• Competitive Pressures: Facing challenges in the Vascular Closure market, with competitive discounting impacting margins.
• Market Cyclicality: Uncertainty regarding the sustainability of recent plasma collection growth, with management cautious about future guidance based on factors they can control.

5. Notable Q&A Insights

• Plasma Collections: Management expressed optimism about the sustainability of high single-digit growth in U.S. collections, driven by share gains and innovation.
• IVT Commercial Efforts: Significant changes in the sales force and strategies are underway to improve performance in Interventional Technologies, with early signs of stabilization and growth.
• Vascular Closure Market: Management remains committed to regaining market share and highlighted the importance of recent product trials and competitive responses.
• Long-term Capital Allocation: Focus on debt repayment and opportunistic share buybacks while maintaining flexibility for strategic investments.

Overall, Haemonetics demonstrated strong financial performance driven by core product growth and strategic initiatives, while also navigating challenges in certain segments and competitive pressures. The company remains optimistic about future growth, particularly in plasma and blood management technologies.