ZBH · 8-K · 20260805PR333761

Gross Margin Drivers

ZIMMER BIOMET HOLDINGS, INC. · 2026-08-05 · Importance 30 · Surprise 14

Second-quarter gross profit increased to $1,378.1 million from $1,324.5 million, but gross margin declined to 63.3% from 63.8%. Adjusted gross margin declined to 71.1% from 72.3%, reflecting $6.0 million of inventory and manufacturing-related charges and $163.4 million of intangible-asset amortization. First-half gross margin increased to 63.9% from 63.5%, while adjusted gross margin was broadly stable at 72.0% versus 71.9%.

Key facts

• Second quarter gross profit: $1,378.1 million and gross margin: 63.3% source
• Second quarter adjusted gross profit: $1,547.5 million and adjusted gross margin: 71.1% source
• Second quarter cost of products sold, excluding intangible asset amortization: $635.5 million source
• Second quarter intangible asset amortization: $163.4 million source
• Inventory step-up expense in the three-month period ended June 30, 2026: $12.0 million and in the six-month period: $24.0 million source
• Inventory and manufacturing-related charges (net income) for three months ended June 30, 2026: income of $3.9 million related to excess and obsolete inventory impacts to product lines intended to be discontinued (note lists $3.9m income in three-month period) source