HAE — Haemonetics Corporation

Haemonetics Corporation (HAE) Q3 2026 Earnings Call Summary

1. Key Financial Results and Metrics

• Revenue: Q3 revenue reached $339 million, with year-to-date revenue at $988 million. Adjusted earnings per share (EPS) increased by 10% to $1.31 for the quarter and 11% to $3.67 year-to-date.
• Organic Growth: Excluding CSL, organic growth was 8% for the quarter and 10% year-to-date.
• Gross Margin: Adjusted gross margin improved to 60.2% for Q3, up 250 basis points year-over-year.
• Free Cash Flow: Generated $74 million in Q3, totaling $165 million year-to-date, with a free cash flow conversion rate of 121% in Q3.
• Guidance: Adjusted EPS for FY 2026 is now expected to be in the range of $4.90 to $5.00. Free cash flow guidance was raised to $200 million to $220 million.

2. Strategic Updates and Business Highlights

• Product Performance: Strong growth in Blood Management Technologies (BMT) and Plasma segments, with BMT revenue up 8% in Q3. TEG 6s disposable sales and the heparinase neutralization cartridge contributed to this growth.
• Interventional Technologies: Experienced a 12% revenue decline in Q3, primarily due to softness in esophageal cooling and OEM-related headwinds. However, the company is optimistic about returning to growth in FY 2027.
• Acquisition: The acquisition of VIVUSHORE was highlighted as a strategic move to enhance the interventional technologies portfolio, with a planned launch in FY 2027.

3. Forward Guidance and Outlook

• Revenue Guidance: Full-year reported revenue guidance revised to a decline of 1% to 3%, improved from a previous decline of 4% to 7%. Organic revenue growth guidance (ex CSL) raised to 8% to 10%.
• Hospital Business: Expected to deliver reported and organic growth of approximately 4% for FY 2026, slightly below the previous range of 4% to 7%.
• Plasma and Blood Center: Plasma revenue grew 3% in Q3, with organic growth (ex CSL) of 20%. Blood center revenue guidance improved, expecting a decline of 16% to 18%, with organic growth of 1% to 3%.

4. Bad News, Challenges, or Points of Concern

• Interventional Technologies Decline: A significant 12% decline in revenue for interventional technologies raises concerns about competitive pressures and market dynamics.
• Margin Pressure: Adjusted operating margin for Q3 was impacted by increased operating expenses and challenges in the hospital segment, particularly interventional technologies.
• Competitive Landscape: The company faces ongoing challenges from competitors, particularly in the vascular closure market, where share loss has been noted.
• Future Margin Expansion: While margins have expanded, future improvements may be smaller, with expectations of 50 to 100 basis points rather than the larger increments seen in FY 2026.

5. Notable Q&A Insights

• Plasma Business Strength: Management expressed confidence in the plasma business, citing strong share gains and a favorable collection environment. Discussions with customers indicate optimism for continued growth.
• Interventional Technologies Focus: The company is committed to returning the interventional technologies segment to growth, with specific strategies in place to address competitive pressures and improve execution.
• VIVUSHORE Acquisition: The acquisition is seen as a key opportunity to enhance market presence in vascular closure, with a focus on a measured approach to launch.
• Market Dynamics: Management acknowledged the impact of new technologies and competitive pricing strategies on market dynamics, particularly in the interventional space, and emphasized the importance of execution to regain market share.

Overall, Haemonetics demonstrated strong financial performance in Q3 2026, with positive growth in key segments, although challenges remain in interventional technologies and competitive pressures. The company is optimistic about future growth driven by strategic initiatives and product launches.