Merit Medical (MMSI) Q1 FY26 earnings call: guidance and Q&A

Seeking updates on WRAPSODY performance, anecdotal or quantitative, given the reaffirmed $7M guidance.

Martha Aronson stated the company is pleased with WRAPSODY's progress, noting the go-to-market strategy reset instituted late last year is working, and they are tracking right on the $7 million guidance for FY26.

“We've given, I think, our previous guidance or our revised guidance in 2026 of $7 million for WRAPSODY for the fiscal year, and we're tracking right on that.”

asked by Michael Petusky · answered by Martha Aronson

Inquiring about the formal process for seeking refunds for tariffs paid and the status of such filings.

Raul Parra confirmed the company has started the process of filing for reimbursement for the majority of tariffs. He noted the administration can challenge reimbursement through May, and an update will be provided on the Q2 call. He expressed optimism that the $15 million tariff impact in guidance could decrease if things remain as they are.

“Yes. We have started the process of reimbursement. Like I said, though, I think the challenge is that the administration can still challenge the reimbursement through May. I think from our perspective, we've started the process of filing and have essentially filed for the majority of that.”

asked by Michael Petusky · answered by Raul Parra

Asking for clarification on the significant revenue ramp for View Point Medical from 2026 to 2027, the 20% growth rate post-2027, and potential synergies with the SCOUT platform.

Martha Aronson explained that View Point Medical expands the breast cancer localization market by 3x-4x, targeting 1.3 million lower-risk biopsy procedures annually, complementing SCOUT which is used for higher-risk patients. Raul Parra confirmed the $14M-$16M revenue for 2027 and the 20% growth rate thereafter, highlighting the acquisition's accretive nature and 70% gross margins.

“With the addition of OneMark, you actually expand the market 3x to 4x because now that other 1.3 million breast biopsies that are done tend to be done for lower-risk patients.”

asked by Jason Bednar · answered by Martha Aronson

Inquiring if the worst is over for OEM, if performance will improve sequentially, and Martha's view on the strategic value of OEM given recent portfolio management actions by other medtech companies.

Raul Parra clarified that Merit's OEM business sells capacity, not contract manufacturing, making divestiture impractical. He stated the business is healthy, expects mid-single-digit growth for Q2, and reaffirmed the normalized mid-to-high single-digit annual growth.

“I think just to kind of level set people on what our OEM business is, we essentially sell capacity, so I would say that we're different than other OEM companies out there. We're not a contract manufacturer. We are selling our own product. Divesting of that just doesn't really work, right?”

asked by Jason Bednar · answered by Raul Parra

Seeking an update on supply dynamics in the cardiac business, which was called out in the prior quarter.

Raul Parra clarified that the issue was a supply chain problem that led to a recall in the renal business, not cardiac. He stated it's financially immaterial for 2026 and they are on track to return the product to market.

“Again, from a financial perspective, it's immaterial to our 2026 financial results. We continue to be on track to have this product back on the market. It's unfortunate that this came to this, but just to kind of highlight it, it's a Class I recall, but we haven't had any of those since 2017. Just to clarify, this was in renal, right, just for clarity.”

asked by Sam Eiber · answered by Raul Parra

Asking what drove the ability to maintain gross margin despite a $5 million tariff expense.

Raul Parra attributed it to the sales force focusing on high-margin products, positive mix effects from acquisitions, and the divestiture of the low-gross-margin DualCap product line. He emphasized the "kitchen sink approach" to maintaining gross margin in a challenging environment.

“Again, hats off to our sales force and focusing on selling the right product at the right price. Obviously, we have some acquisitions, too, that are helping us, and that's part of that mix component.”

asked by James Sidoti · answered by Raul Parra

Inquiring about the distribution of the OneMark system before and after acquisition, and if the significant revenue jump in 2027 is due to increased distribution or product awareness.

Martha Aronson stated that View Point was a smaller organization and will integrate into Merit's team. She clarified that the 2027 revenue jump is driven by increased product awareness, options for accounts, and excellent account planning and targeting, rather than a major expansion of commercial footprint.

“It's increased product awareness and it's being able to have options as you go into each and every account, and it's some really excellent account planning and targeting that our team is undertaking.”

asked by James Sidoti · answered by Martha Aronson

Seeking additional color on the Endoscopy segment, integration, and sales force training.

Martha Aronson highlighted the C2 CryoBalloon acquisition exceeding expectations and the launch of The Resilience TTS Esophageal Stent, which offers improved control and migration resistance in a sub-$100 million market. Raul Parra added that the endoscopy team achieved mid-teen growth in Q1.

“Q1 was mid-teen growth. Really strong performance by them, and they're excited about what they're doing, which makes us excited about the potential that they have.”

asked by John Young · answered by Raul Parra