AXGN · 10-Q · 2026Q1 · Full report

Gross Margin Drivers

Axogen, Inc. · 2026-04-28 · Importance 64 · Surprise 56

Gross profit increased 32.2% year-over-year and gross margin expanded to 75.2% for Q1 2026, reflecting improvements in product-level economics. Management attributes higher margins to lower inventory write-offs and lower shipping costs on products sold, though these gains were partially offset by higher product costs. The margin improvement contributed to overall profitability trends despite higher operating expenses. These drivers indicate supply chain and inventory management improvements materially affected product gross margins during the quarter.

Key facts

• Gross profit for the quarter ended March 31, 2026 increased $11,256 or 32.2% compared to the quarter ended March 31, 2025
• Cost of goods sold for the quarter ended March 31, 2026 were $15,268, representing 24.8% of revenue
• Cost of goods sold for the quarter ended March 31, 2025 were $13,627, representing 28.1% of revenue
• Gross profit for the quarter ended March 31, 2026 was $46,189
• Gross profit for the quarter ended March 31, 2025 was $34,933
• Gross margin as a percentage of revenues was 75.2% for the three months ended March 31, 2026
• Gross margin as a percentage of revenues was 71.9% for the three months ended March 31, 2025
• Higher margins were driven by lower inventory write-offs and lower shipping costs on products sold, partially offset by higher product costs

Impact estimates