Medical device company Integra LifeSciences (NASDAQ:IART) announced better-than-expected revenue in Q4 CY2025, but sales fell by 1.7% year on year to $434.9 million. On the other hand, next quarter’s revenue guidance of $382.5 million was less impressive, coming in 2.8% below analysts’ estimates. Its non-GAAP profit of $0.83 per share was 3.7% above analysts’ consensus estimates.

Is now the time to buy Integra LifeSciences? Find out in our full research report.

Revenue: $434.9 million vs analyst estimates of $430.5 million (1.7% year-on-year decline, 1% beat)

Adjusted EPS: $0.83 vs analyst estimates of $0.80 (3.7% beat)

Adjusted EBITDA: $104.2 million vs analyst estimates of $101 million (24% margin, 3.2% beat)

Revenue Guidance for Q1 CY2026 is $382.5 million at the midpoint, below analyst estimates of $393.4 million

Adjusted EPS guidance for the upcoming financial year 2026 is $2.35 at the midpoint, in line with analyst estimates

Operating Margin: 5.3%, down from 14.5% in the same quarter last year

Free Cash Flow was -$5.4 million, down from $21.14 million in the same quarter last year

Organic Revenue rose 2.5% year on year (beat)

Market Capitalization: $902.8 million

“In the fourth quarter, we drove tangible operational progress while continuing to deliver for our customers and patients,” said Mojdeh Poul, president and chief executive officer.

Founded in 1989 as a pioneer in regenerative medicine technology, Integra LifeSciences (NASDAQ:IART) develops and manufactures medical technologies for neurosurgery, wound care, and surgical reconstruction, including regenerative tissue products and surgical instruments.

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can have short-term success, but a top-tier one grows for years. Regrettably, Integra LifeSciences’s sales grew at a tepid 3.6% compounded annual growth rate over the last five years. This was below our standard for the healthcare sector and is a poor baseline for our analysis.

We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Integra LifeSciences’s annualized revenue growth of 3% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak.

Integra LifeSciences also reports organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, Integra LifeSciences’s organic revenue averaged 2.4% year-on-year growth. Because this number aligns with its two-year revenue growth, we can see the company’s core operations (not acquisitions and divestitures) drove most of its results.

This quarter, Integra LifeSciences’s revenue fell by 1.7% year on year to $434.9 million but beat Wall Street’s estimates by 1%. Company management is currently guiding for flat sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 2.4% over the next 12 months, similar to its two-year rate. This projection doesn't excite us and suggests its newer products and services will not lead to better top-line performance yet.

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Integra LifeSciences has done a decent job managing its cost base over the last five years. The company has produced an average operating margin of 14.3%, higher than the broader healthcare sector.

Looking at the trend in its profitability, Integra LifeSciences’s operating margin decreased by 10.4 percentage points over the last five years. The company’s two-year trajectory also shows it failed to get its profitability back to the peak as its margin fell by 8.6 percentage points. This performance was poor no matter how you look at it - it shows its expenses were rising and it couldn’t pass those costs onto its customers.

This quarter, Integra LifeSciences generated an operating margin profit margin of 5.3%, down 9.2 percentage points year on year. This contraction shows it was less efficient because its expenses increased relative to its revenue.

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Sadly for Integra LifeSciences, its EPS declined by 1.9% annually over the last five years while its revenue grew by 3.6%. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.

Diving into the nuances of Integra LifeSciences’s earnings can give us a better understanding of its performance. As we mentioned earlier, Integra LifeSciences’s operating margin declined by 10.4 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q4, Integra LifeSciences reported adjusted EPS of $0.83, down from $0.97 in the same quarter last year. Despite falling year on year, this print beat analysts’ estimates by 3.7%. Over the next 12 months, Wall Street expects Integra LifeSciences’s full-year EPS of $2.23 to grow 5.8%.

We were impressed by how significantly Integra LifeSciences blew past analysts’ organic revenue expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. On the other hand, its revenue guidance for next quarter missed and its EPS guidance for next quarter fell short of Wall Street’s estimates. Overall, this was a mixed quarter. The stock remained flat at $11.71 immediately following the results.

Should you buy the stock or not? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free.