Alphatec (NASDAQ: ATEC) posts Q1 growth and cuts interest costs with new bank facility
Rhea-AI Filing Summary
Alphatec Holdings, Inc. reported strong first-quarter 2026 growth and refinanced its debt with an inaugural syndicated bank facility. The new $175 million Term Loan A and $125 million revolver, led by JPMorgan and TD Securities, replace prior term loan and ABL facilities and extend maturities to 2031. At closing, the facility bears interest at SOFR plus 275 basis points and is expected to cut annual interest expense by more than $6 million, with over $35 million of potential savings over its life.
For the quarter ended March 31, 2026, total revenue reached $192 million, up from $169.2 million, with surgical revenue of $178 million growing 17% year over year on 21% case volume growth. GAAP gross margin was 71% and non‑GAAP gross margin 72%. GAAP operating expenses were $159 million, yielding a GAAP net loss of $33.9 million, or $0.22 per share, while non‑GAAP net income was roughly breakeven at $0.4 million.
Non‑GAAP adjusted EBITDA rose to $20.7 million, an 11% margin and a 460‑basis‑point expansion year over year. The company ended the quarter with $140 million in cash and reaffirmed 2026 surgical revenue guidance of about $805 million, while trimming EOS revenue to $77 million. It now targets total 2026 revenue of approximately $882 million, 15% growth, adjusted EBITDA of about $134 million (15% margin), and at least $20 million of free cash flow.
Positive
- Debt refinancing lowers interest cost and extends maturities: A new $175 million Term Loan A and $125 million revolver, maturing in 2031, are expected to reduce annual interest expense by more than $6 million and over $35 million across the life of the facility.
- Strong operating momentum and margin expansion: Q1 2026 revenue reached $192 million, with surgical revenue up 17% year over year and adjusted EBITDA increasing to $20.7 million, expanding adjusted EBITDA margin by 460 basis points to 11%.
- Supportive 2026 outlook with improving profitability: The company targets approximately $882 million in 2026 revenue (about 15% growth), adjusted EBITDA of $134 million at a 15% margin, and at least $20 million of free cash flow.
Negative
- None.
Insights
Alphatec pairs double‑digit growth with cheaper, longer‑dated debt.
Alphatec delivered Q1 2026 revenue of $192 million, up 14% year over year, with surgical revenue up 17% on 21% case growth. Non‑GAAP adjusted EBITDA nearly doubled to $20.7 million, lifting margin to 11%, a 460‑basis‑point expansion, while non‑GAAP net income was essentially breakeven.
On the balance sheet, the company replaced its prior term loan and ABL facilities with a new syndicated bank structure: a $175.0 million Term Loan A and $125.0 million revolver maturing in 2031. Management expects more than $6 million in annual interest savings and over $35 million across the facility’s life, which could materially enhance future earnings power if operating performance holds.
The company’s 2026 outlook calls for about $882 million of revenue (roughly 15% growth), adjusted EBITDA of $134 million at a 15% margin, and at least $20 million of free cash flow. Actual results will depend on sustaining surgical momentum, executing against moderated EOS expectations, and complying with leverage and coverage covenants under the new credit agreement.
8-K Event Classification
Key Figures
Key Terms
Term Loan A financial
revolving credit facility financial
Senior Secured Net Leverage Ratio financial
Fixed Charge Coverage Ratio financial
adjusted EBITDA financial
loss on debt extinguishment financial
Earnings Snapshot
For 2026, Alphatec targets approximately $882 million revenue (~15% growth), including $805 million surgical and $77 million EOS, adjusted EBITDA of about $134 million (15% margin), and at least $20 million of free cash flow.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
On May 1, 2026 (the “Closing Date”), Alphatec Holdings, Inc. (the “Company”) and certain of its domestic subsidiaries (collectively, the “Subsidiary Guarantors”), as guarantors party thereto, entered into a senior secured credit agreement (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent (the “Agent”) and the lenders and issuing banks party thereto. The Credit Agreement provides for (i) a $175.0 million term loan A facility (the “Term Loan A”) and (ii) a $125.0 million revolving credit facility, with a sublimit of up to $20.0 million for foreign currency loans, $30.0 million for the issuance of letters of credit and $10.0 million for swingline loans(the “Revolving Credit Facility” and, together with the Term Loan A, the “Credit Facilities”). The Credit Facilities mature on the fifth anniversary of the Closing Date (the “Scheduled Maturity Date”), subject to a springing maturity during the period from (a) December 14, 2029 (the date that is 91 days prior to the scheduled maturity date of the Company’s existing 0.75% convertible senior notes due 2030 (the “2030 Convertible Notes”)) until (b) the earlier of (i) March 15, 2030 (the scheduled maturity date of the 2030 Convertible Notes or the later scheduled maturity date of any extension or refinancing of the 2030 Convertible Notes that has a scheduled maturity date prior to the 91st day of the Scheduled Maturity Date) and (ii) the date on which the outstanding principal amount of the 2030 Convertible Notes and any extension or refinancing thereof is less than or equal to $85.0 million, if the Company and its subsidiaries fail to maintain liquidity (defined as unrestricted cash held in the U.S. plus amounts available under the Revolving Credit Facility) in an amount equal to or greater than the sum of (x) the outstanding principal amount of the 2030 Convertible Notes and any extension or refinancing thereof plus (y) $100.0 million.
The loans under the Revolving Credit Facility may be denominated in U.S. dollars, Euros, Sterling, Australian Dollars, Singapore Dollars, Swiss Francs, and Japanese Yen. Loans borrowed under the Term Loan A may only be denominated in U.S. dollars. Loans incurred under the Credit Facilities bear interest at a rate equal to, (i) for loans denominated in U.S. dollars, at the Company’s election, Term SOFR Rate or the Alternate Base Rate (each as defined in the Credit Agreement) and (ii) for loans denominated in foreign currencies, the applicable Relevant Rate (as defined in the Credit Agreement), in the case of each of the foregoing clauses (i) and (ii), plus an applicable margin based on the Company’s Senior Secured Net Leverage Ratio (defined as total indebtedness of the Company and its subsidiaries that is secured by a lien on the assets of the Company and its subsidiaries, minus any unrestricted cash of the Company and its subsidiaries in excess of $100.0 million to Consolidated EBITDA (as defined in the Credit Agreement). The applicable margin ranges from 1.00% to 2.50% for ABR Loans and 2.00% to 3.50% for Term Benchmark Loans and RFR Loans (each as defined in the Credit Agreement).
The Credit Agreement provides for (i) quarterly amortization payments on the Term Loan A equal to, for the first eight full fiscal quarters after the Closing Date, 0.625% of the aggregate principal amount of the Term Loan A advanced on the Closing Date, stepping up to 1.25% for the ninth through sixteenth full fiscal quarters after the Closing Date, and for each fiscal quarter thereafter, 2.50%, with the remaining balance due at maturity, (ii) commitment fees on the unused commitments under the Revolving Credit Facility, ranging from 0.20% to 0.35% per annum based on the Company’s Senior Secured Net Leverage Ratio, and (iii) an incremental accordion feature of up to the sum of (x) the greater of (A) $150.0 million and (B) 100% of Consolidated EBITDA of the Company, plus (y) the amount of any voluntary prepayments of the Term Loan A and voluntary permanent reductions of the commitments under the Revolving Credit Facility, subject to customary conditions.
On the Closing Date, the Company borrowed $175.0 million of the Term Loan A, and $40.0 million of loans under the Revolving Credit Facility. Proceeds from the Credit Facilities were used, together with the Company’s cash on hand, (a) to repay in full all outstanding obligations under that certain (i) Credit, Security and Guaranty Agreement, dated as of September 29, 2022 (as amended, restated, supplemented or otherwise modified prior to the Closing Date), among the Company, the other borrowers from time to time party thereto, the lenders party thereto and MidCap Funding IV Trust, as the administrative agent (the “ABL Credit Agreement”) and (ii) Credit, Security and Guaranty Agreement, dated as of January 6, 2023 (as amended, restated, supplemented or otherwise modified prior to the Closing Date), among the Company, the guarantors from time to time party thereto and Wilmington Trust, National Association, as agent (the “2023 Term Loan Agreement,” and together with the ABL Credit Agreement, the “Prior Credit Agreements”) and (b) to pay certain costs, fees and expenses in connection with the transaction on the Closing Date.
The Credit Agreement requires the Company to maintain (i) a Senior Secured Net Leverage Ratio not exceeding 3.00 to 1.00, subject to, at the Company’s election, a step-up to 3.50 to 1.00 following the completion of certain permitted acquisitions having consideration that is equal to or greater than $75.0 million, and (ii) a Fixed Charge Coverage Ratio (defined as Consolidated EBITDA minus unfinanced capital expenditures to consolidated fixed charges) of at least 2.00 to 1.00, in each case tested quarterly commencing with the fiscal quarter ending September 30, 2026.
The Credit Facilities are guaranteed by the Subsidiary Guarantors and secured by substantially all of the assets of the Company and the Subsidiary Guarantors, subject to customary exclusions and limitations set forth in the Credit Agreement and the related loan documents. The Credit Agreement contains representations and warranties and affirmative and negative covenants that are usual and customary, including negative covenants that, subject to the exceptions set forth in the Credit Agreement, limit the ability for the Company and its subsidiaries to incur additional debt, incur or permit liens on assets, make investments and acquisitions, consolidate or merge with any other company, engage in asset sales and make dividends and distributions.
Obligations under the Credit Agreement may be accelerated upon the occurrence of certain customary events of default (subject, in appropriate cases, to grace periods set forth in the Credit Agreement), including among others: nonpayment of principal, interest or fees; breach of the affirmative, negative or financial covenants; breach of the representations or warranties in any material respect; events of default with respect to other material indebtedness; bankruptcy or insolvency; material judgments entered against the Company or any of its subsidiaries that are not promptly paid or stayed; invalidity or unenforceability of the security documents and guarantees associated with the Credit Agreement; and a change of control of the Company.
On May 5, 2026, the Company issued a press release announcing the Credit Agreement. A copy of the press release is attached hereto as Exhibit 99.1.
The foregoing description of the Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Credit Agreement attached hereto as Exhibit 10.1 and incorporated herein by reference.
Item 1.02 Termination of a Material Definitive Agreement.
On May 1, 2026, in connection with the entry into the Credit Agreement, the Company terminated the Prior Credit Agreements. On such date, the Company repaid in full all outstanding principal, accrued interest and applicable fees under each of the Prior Credit Agreements. The disclosure set forth in Item 1.01 above with respect to the Prior Credit Agreements is incorporated by reference into this Item 1.02.
A description of the ABL Credit Agreement is included in Item 1.01 of the Current Report on Form 8-K filed by the Company on October 3, 2022 and is incorporated by reference into this Item 1.02. A description of the 2023 Term Loan Agreement is included in Item 1.01 of the Current Report on Form 8-K filed by the Company on January 9, 2023 and is incorporated by reference into this Item 1.02.
Item 2.02 Results of Operations and Financial Condition.
The following information is furnished pursuant to Item 2.02, “Results of Operations and Financial Condition,” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.
On May 5, 2026, the Company issued a press release announcing its financial results for its period ended March 31, 2026. A copy of the press release is attached hereto as Exhibit 99.2.
The information contained in this Current Report, including the exhibit, shall not be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosure set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
10.1 |
Form of Confirmation of Credit Agreement dated May 1, 2026 |
99.1 |
Press Release of Alphatec Holdings, Inc., dated May 5, 2026 |
99.2 |
Press Release of Alphatec Holdings, Inc., dated May 5, 2026 |
104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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Alphatec Holdings, Inc. |
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Date: |
May 5, 2026 |
By: |
/s/ J. Todd Koning |
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J. Todd Koning |
ATEC Refinances Existing Debt with Inaugural Bank Facility
CARLSBAD, Calif., May 5, 2026 – Alphatec Holdings, Inc. (Nasdaq: ATEC), a spine-focused provider of innovative solutions dedicated to revolutionizing the approach to spine surgery, today announced it has entered into a new credit facility, including a $125 million revolving credit facility and $175 million Term Loan A, led by JPMorgan Chase Bank, N.A. and TD Securities (USA) LLC. This transaction represents ATEC’s inaugural syndicated bank facility and reflects the Company’s strong operating performance and continued progression to a more scaled and profitable financial profile.
The new facility refinances the Company’s existing debt, including its prior term loan and asset-based lending facilities with Braidwell LP, Pharmakon Advisors LP, and MidCap Financial Trust, simplifies its capital structure, reduces borrowing costs, and extends maturities to 2031. At close, the facility carries an interest rate of SOFR plus 275 basis points and is expected to reduce interest expense by more than $6 million annually, with the potential to generate more than $35 million of savings over the life of the facility. The new facility also includes an incremental $150 million accordion feature, providing additional flexibility as the Company grows.
“This transaction marks an important step in the improvement of our capital structure,” said Todd Koning, Chief Financial Officer. “By lowering our cost of capital, extending our maturity profile, and partnering with a leading bank syndicate, we have strengthened our financial foundation. This new facility reflects the maturation of our business and positions us with a more scalable and flexible financing structure as we continue to grow.”
“We appreciate the support of our prior lending partners, Braidwell, Pharmakon, and MidCap, who have been important contributors to ATEC’s growth,” added Koning.
Additional information regarding the credit facility, including a copy of the credit agreement, will be included in a Current Report on Form 8-K to be filed by the Company with the Securities and Exchange Commission.
About Alphatec Holdings, Inc.
ATEC, through its wholly owned subsidiaries, Alphatec Spine, Inc., EOS imaging S.A.S., and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC’s Organic Innovation MachineTM is focused on developing new approaches that integrate seamlessly with the Company’s expanding InformatiXTM platform to better inform surgery and more safely and reproducibly achieve the goals of spine surgery. ATEC’s vision is to be the Standard Bearer in Spine. For more information, visit us at www.atecspine.com.
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Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The Company cautions investors that there can be no assurance that actual results will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. Forward-looking statements include, but are not limited to: references to the expected reduction in interest expense and related cost savings over the life of the facility; the anticipated benefits of the new credit facility, including its maturity profile, borrowing costs, and incremental accordion feature; the Company's ability to utilize additional capacity under the facility to support future growth; and the Company's expectations regarding its financial condition, capital structure, and ability to meet its financial obligations. Important factors that could cause actual results to differ significantly from those expressed or implied by such forward-looking statements include, but are not limited to: changes in interest rates or credit market conditions that affect borrowing costs; the Company's ability to satisfy the terms and covenants of the new credit facility; unanticipated expenses, liabilities, or other adverse events affecting cash flow or the Company's ability to achieve profitability; uncertainty of additional funding; and the Company's ability to meet its financial obligations and achieve expected financial outcomes. A further list and description of these and other factors, risks and uncertainties can be found in the Company's most recent annual report, and any subsequent quarterly and current reports, filed with the U.S. Securities and Exchange Commission. ATEC disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.
Investor/Media Contact:
Robert Judd
Investor Relations
(760) 494-6790
investorrelations@atecspine.com
Company Contact:
J. Todd Koning
Chief Financial Officer
investorrelations@atecspine.com
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Exhibit 99.2 |
ATEC Reports First Quarter Financial Results
CARLSBAD, Calif., May 5, 2026 – Alphatec Holdings, Inc. (Nasdaq: ATEC), a spine-focused provider of innovative solutions dedicated to revolutionizing the approach to spine surgery, today announced financial results for the quarter ended March 31, 2026, and business highlights.
First Quarter 2026 Financial Results
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Quarter Ended March 31, 2026 |
Total revenue |
$192 million |
GAAP gross margin |
71% |
Non-GAAP gross margin |
72% |
GAAP operating expenses |
$159 million |
Non-GAAP operating expenses |
$132 million |
GAAP net income / (loss) |
($34) million |
Non-GAAP net income / (loss) |
$0 million |
Non-GAAP adjusted EBITDA |
$21 million |
Non-GAAP adjusted EBITDA margin |
11% |
Ending cash balance |
$140 million |
First Quarter Highlights
“ATEC’s surgical business continues to demonstrate strong momentum, with volume-driven growth and increasing surgeon adoption reinforcing the strength of our procedural approach,” said Pat Miles, Chairman and Chief Executive Officer. “We are adjusting our EOS expectations, but the underlying fundamentals of our business are strong and our conviction in the long-term opportunity has not changed. We are confident that our data-driven procedural ecosystem improves patient outcomes, which in turn drives durable growth, expanding margins, and long-term value.”
Financial Outlook for the Full Year 2026
The Company now expects total revenue for the fiscal year ending December 31, 2026 to approximate $882 million, representing approximately 15% total revenue growth, including 17% growth in surgical revenue. The Company reiterates surgical revenue guidance of approximately $805 million and adjusts EOS revenue to approximately $77 million.
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The Company continues to expect adjusted EBITDA of approximately $134 million, or 15% of revenue, reflecting ongoing and disciplined operating leverage. The Company also continues to expect at least $20 million of free cash flow for the full year 2026.
Company Refinances Existing Debt with Inaugural Bank Facility
The Company announced it has entered into an inaugural bank facility, including a revolving credit facility and Term Loan A, led by JPMorgan Chase Bank, N.A. and TD Securities (USA) LLC. The new facility refinances the Company’s existing debt, reduces borrowing costs, and extends maturities to 2031. The facility will reduce interest expense by more than $6 million annually, with the potential to generate more than $35 million of savings over the life of the facility. Additional details regarding the transaction are included in a separate press release issued today.
Financial Results Webcast
The Company will host a live webcast today at 1:30 p.m. PT / 4:30 p.m. ET. To access the live webcast, please visit the Investor Relations section of ATEC’s corporate website.
A replay of the webcast will remain available through the Investor Relations section of ATEC’s corporate website for twelve months.
Analyst Webcast Participation
To participate in the question-and-answer session, analysts must register in advance using this link. Upon registration, access details, including a unique code, will be provided via email.
Non-GAAP Financial Information
To supplement the Company’s financial statements presented in accordance with generally accepted accounting principles in the United States of America (GAAP), the Company reports certain non-GAAP financial measures listed below under “Non-GAAP Financial Measures.” The Company believes that these non-GAAP financial measures provide investors with an additional tool for evaluating the Company's core performance, which management uses in its own evaluation of continuing operating performance, and provides a baseline for assessing the Company’s future earnings potential. The Company’s non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate non-GAAP financial measures differently, particularly related to non-recurring, unusual items. Non-GAAP financial measures should be considered in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. We have not reconciled our non-GAAP financial measures for the full year 2026 because certain items that impact these figures are either uncertain or outside our control and cannot be reasonably predicted. Accordingly, a reconciliation of forward-looking, non-GAAP financial measures is not available. Included below are definitions of the non-GAAP financial measures the Company uses.
Non-GAAP Financial Measures
Free cash flow: Calculated by subtracting capital expenditures from cash flow provided by or used in operating activities. Management uses free cash flow to measure progress on its capital efficiency and cash flow initiatives.
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Non-GAAP Gross Profit and Non-GAAP Gross Margin: Non-GAAP gross profit represents GAAP gross profit with adjustments to exclude the impact of certain items recorded to cost of goods sold. Such potential adjustments are described within the section below under "Non-GAAP Adjustments" and included in the non-GAAP reconciliation attached below. Non-GAAP gross margin represents non-GAAP gross profit as a percentage of GAAP net sales.
Non-GAAP Operating Expenses: Non-GAAP operating expenses represent GAAP operating expenses, such as sales, general, and administrative expense, and research and development expense, with adjustments to exclude the impact of certain items recorded in GAAP operating expenses. Such potential adjustments are described within the section below under "Non-GAAP Adjustments" and included in the non-GAAP reconciliation.
Non-GAAP Net Income (Loss) and Non-GAAP EPS: Non-GAAP net income (loss) represents GAAP net loss with adjustments to exclude the impact of certain items recorded in GAAP net loss. Such potential adjustments are described within the sections below under "Non-GAAP Adjustments" and included in the non-GAAP reconciliation. Non-GAAP EPS represents non-GAAP net income (loss) divided by weighted-average shares outstanding.
EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin: EBITDA represents earnings before non-operating income/expense, taxes, depreciation and amortization. Adjusted EBITDA consists of EBITDA with adjustments to exclude certain items described within the section below under "Non-GAAP Adjustments" and included in the non-GAAP reconciliation. Adjusted EBITDA margin represents adjusted EBITDA as a percentage of GAAP net sales.
Non-GAAP Adjustments
The Company's non-GAAP financial measures reflect the exclusion of the following items:
Amortization of acquired intangible assets: Represents amortization expense associated with intangible assets including, but not limited to customer relationships, intellectual property, and trade names acquired in business combinations and asset acquisitions. This adjustment does not include amortization from other intangibles.
Litigation-related expenses: We are involved in various litigation matters that from time to time result in settlements. Litigation matters can vary in their characteristics, frequency and significance to our operating results and core business operations. We review litigation matters from both a qualitative and quantitative perspective to determine whether such matters are a normal and recurring part of our business. We include in our GAAP financial statements litigation fees and settlement expenses that we determine to be normal, recurring and routine to our business. When we determine that certain litigation matters are not normal and recurring to our core business operations, we believe excluding these expenses will provide our management and investors with useful incremental information. Litigation fees and settlement expenses excluded from our non-GAAP financial measures in the periods presented relate primarily to patent litigation and other litigation matters that relate directly to the business transformation that we started in 2018 and are discussed more fully in our periodic reports filed with the Securities and Exchange Commission.
Purchase accounting adjustments on acquisitions: Includes non-cash expenses incurred as a result of fair value step-ups associated with tangible assets acquired in business combinations or asset acquisitions.
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Restructuring expenses: From time to time, in order to realign the Company’s operations or to realize synergies from acquisitions, the Company may eliminate roles or restructure its operations and footprint. In such cases, the Company may incur one-time severance and personnel costs associated with workforce reductions, or costs associated with exiting and/or relocating facilities. We exclude these costs as we do not consider such amounts to be part of the ongoing operations.
Stock-based compensation: Stock-based compensation is charged to cost of revenue and operating expenses. We exclude stock-based compensation from certain of our non-GAAP financial measures because we believe that excluding these non-cash expenses provides meaningful supplemental information regarding operational performance. Because of the variety of equity awards used by companies, the varying methodologies for determining stock-based compensation expense, the subjective assumptions involved in those determinations, and the volatility in valuations that can be driven by market conditions outside the Company’s control, the Company believes excluding stock-based compensation expense enhances the ability of management and investors to understand and assess the underlying performance of its business over time.
Transaction-related expenses: Represent one-time costs incurred in connection with business combinations, asset acquisitions, or debt financing and modification activities. These expenses may include, but are not limited to, legal and advisory fees, due diligence costs, contract termination charges, and other third-party expenses directly related to the planning or execution of these transactions. We exclude these costs because they can vary significantly from period to period and are not indicative of the underlying trends in our core business.
Foreign currency exchange impact: Gains and losses related to foreign currency transactions, which are recorded as other income (expense), net. Management excludes these items when evaluating the Company's operating results as they are primarily non-cash and non-operating in nature.
Loss on debt extinguishment: Represents charges recognized in connection with the early repayment, refinancing, or settlement of debt, including write-offs of unamortized debt discounts, premiums, or deferred financing costs, and any associated prepayment penalties. We exclude these items from non-GAAP results because they are non-recurring in nature, not indicative of ongoing operating performance, and can vary significantly from period to period based on financing activity.
Loss (gain) on derivative liability: Represents non-cash fair value adjustments associated with embedded derivative features related to our convertible debt. These mark-to-market changes are driven by fluctuations in our stock price and other valuation inputs, and do not reflect current operating performance. We exclude these amounts from non-GAAP results because they are non-cash, volatile, and unrelated to the Company’s core business operations.
Non-cash interest expense: Consists primarily of interest expense related to the amortization of debt discounts, deferred financing costs, and other non-cash components associated with our convertible notes and other long-term debt instruments. We exclude this item from non-GAAP net income because it is non-cash in nature and does not reflect our core operating performance or current period cash expenditures.
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Long-term income tax rate adjustment: The Company employs a structural long-term projected non-GAAP income tax rate of 26% for greater consistency across reporting periods. This long-term projected non-GAAP tax rate reflects historical and expected tax positions and excludes any benefit from deferred tax assets or valuation allowance changes. The long-term rate considers various factors, including the Company’s anticipated tax structure, its tax positions in different jurisdictions, and current impacts from key U.S. legislation where the Company operates. We will reevaluate this tax rate, as necessary, for events such as major changes in the U.S. tax environment, substantial changes in the Company’s geographic earnings mix due to acquisition activity, or other shifts in the Company’s strategy or business operations.
Other non-recurring expenses: These represent items that are unusual or infrequent in nature and that we believe are not indicative of our ongoing operating performance. Examples may include discrete costs associated with tax strategy implementation or one-time expenses related to customer restructuring or reorganization events. We evaluate such items based on their nature and significance and disclose material adjustments in our non-GAAP reconciliations.
About Alphatec Holdings, Inc.
ATEC, through its wholly owned subsidiaries, Alphatec Spine, Inc., EOS imaging S.A.S., and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC’s Organic Innovation MachineTM is focused on developing new approaches that integrate seamlessly with the Company’s expanding InformatiXTM platform to better inform surgery and more safely and reproducibly achieve the goals of spine surgery. ATEC’s vision is to be the Standard Bearer in Spine. For more information, visit us at www.atecspine.com.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The Company cautions investors that there can be no assurance that actual results will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. Forward-looking statements include, but are not limited to: references to the Company’s revenue, balance sheet, growth, and financial outlook and commitments; planned product launches, timelines, introductions, regulatory submissions or clearances; and the Company's ability to compel surgeon adoption and drive procedural growth; and the expected reduction in interest expense and related cost savings over the life of the new credit facility, including assumptions regarding borrowing costs, interest rates, and the utilization of the facility. Important factors that could cause actual operating results to differ significantly from those expressed or implied by such forward-looking statements include, but are not limited to: the uncertainty of success in developing new products or products currently in the pipeline; the uncertainties in the Company’s ability to execute upon its strategic operating plan; the uncertainties regarding the ability to successfully license or acquire new products, and the commercial success of such products; failure to achieve acceptance of the Company’s products by the surgeon community; failure to obtain FDA or other regulatory clearance or approval or unexpected or prolonged delays in the process; continuation of favorable third-party reimbursement; unanticipated expenses or liabilities or other adverse events affecting cash flow or the Company’s ability to achieve profitability; uncertainty of additional funding and the form of such funding; product liability exposure; an unsuccessful outcome in any litigation; patent infringement claims; claims related to the Company’s intellectual property; and the Company’s ability to meet its financial obligations; changes in interest rates or credit
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market conditions that could affect the anticipated borrowing cost savings; and the Company’s ability to satisfy the terms and covenants of the new credit facility. A further list and description of these and other factors, risks and uncertainties can be found in the Company's most recent annual report, and any subsequent quarterly and current reports, filed with the U.S. Securities and Exchange Commission. ATEC disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.
Investor/Media Contact:
Robert Judd
Investor Relations
(760) 494-6790
investorrelations@atecspine.com
Company Contact:
J. Todd Koning
Chief Financial Officer
investorrelations@atecspine.com
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ALPHATEC HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
|
|
Three Months Ended |
|
|||||
|
|
March 31 |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
|
|
(unaudited) |
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|||||
Revenue from products and services |
|
$ |
192,108 |
|
|
$ |
169,180 |
|
Cost of sales |
|
|
55,632 |
|
|
|
53,184 |
|
Gross profit |
|
|
136,476 |
|
|
|
115,996 |
|
Operating expenses: |
|
|
|
|
|
|
||
Research and development |
|
|
17,560 |
|
|
|
16,582 |
|
Sales, general and administrative |
|
|
137,057 |
|
|
|
127,017 |
|
Litigation-related expenses |
|
|
525 |
|
|
|
12,214 |
|
Amortization of acquired intangible assets |
|
|
3,915 |
|
|
|
4,103 |
|
Restructuring expenses |
|
|
— |
|
|
|
371 |
|
Total operating expenses |
|
|
159,057 |
|
|
|
160,287 |
|
Operating loss |
|
|
(22,581 |
) |
|
|
(44,291 |
) |
Other expense, net: |
|
|
|
|
|
|
||
Cash interest expense, net |
|
|
(4,953 |
) |
|
|
(5,356 |
) |
Noncash interest expense, net |
|
|
(6,768 |
) |
|
|
(2,485 |
) |
Loss on debt extinguishment |
|
|
— |
|
|
|
(17,576 |
) |
Gain on derivative liability |
|
|
— |
|
|
|
17,400 |
|
Other income, net |
|
|
446 |
|
|
|
337 |
|
Total other expense, net |
|
|
(11,275 |
) |
|
|
(7,680 |
) |
Net loss before taxes |
|
|
(33,856 |
) |
|
|
(51,971 |
) |
Income tax provision (benefit) |
|
|
50 |
|
|
|
(64 |
) |
Net loss |
|
$ |
(33,906 |
) |
|
$ |
(51,907 |
) |
Net loss per share, basic and diluted |
|
$ |
(0.22 |
) |
|
$ |
(0.35 |
) |
Weighted average shares outstanding, basic and diluted |
|
|
154,051 |
|
|
|
146,732 |
|
Stock-based compensation included in: |
|
|
|
|
|
|
||
Cost of sales |
|
$ |
970 |
|
|
$ |
3,043 |
|
Research and development |
|
|
4,001 |
|
|
|
3,644 |
|
Sales, general and administrative |
|
|
18,688 |
|
|
|
15,631 |
|
|
|
$ |
23,659 |
|
|
$ |
22,318 |
|
|
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ALPHATEC HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
|
|
March 31, |
|
|
December 31, |
|
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ASSETS |
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|||||||
Current assets: |
|
|
|
|
|
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||
Cash and cash equivalents |
|
$ |
139,912 |
|
|
$ |
160,806 |
|
Accounts receivable, net |
|
|
106,379 |
|
|
|
97,304 |
|
Inventories |
|
|
186,027 |
|
|
|
169,444 |
|
Prepaid expenses and other current assets |
|
|
23,849 |
|
|
|
23,322 |
|
Total current assets |
|
|
456,167 |
|
|
|
450,876 |
|
Property and equipment, net |
|
|
138,045 |
|
|
|
135,324 |
|
Right-of-use assets |
|
|
30,601 |
|
|
|
31,225 |
|
Goodwill |
|
|
74,470 |
|
|
|
75,208 |
|
Intangible assets, net |
|
|
90,023 |
|
|
|
93,454 |
|
Other assets |
|
|
10,172 |
|
|
|
5,121 |
|
Total assets |
|
$ |
799,478 |
|
|
$ |
791,208 |
|
|
|
|
|
|
|
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LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY |
|
|||||||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
46,044 |
|
|
$ |
40,893 |
|
Accrued expenses and other current liabilities |
|
|
111,567 |
|
|
|
97,019 |
|
Contract liabilities |
|
|
10,466 |
|
|
|
10,439 |
|
Short-term debt |
|
|
65,522 |
|
|
|
64,526 |
|
Current portion of operating lease liabilities |
|
|
6,645 |
|
|
|
6,298 |
|
Total current liabilities |
|
|
240,244 |
|
|
|
219,175 |
|
Total long-term liabilities |
|
|
540,978 |
|
|
|
536,004 |
|
Redeemable preferred stock |
|
|
23,603 |
|
|
|
23,603 |
|
Stockholders' (deficit) equity |
|
|
(5,347 |
) |
|
|
12,426 |
|
Total liabilities and stockholders' (deficit) equity |
|
$ |
799,478 |
|
|
$ |
791,208 |
|
|
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ALPHATEC HOLDINGS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(in thousands)
|
|
Three Months Ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
(unaudited) |
|
|
|
|||||
Gross profit, GAAP |
|
$ |
136,476 |
|
|
$ |
115,996 |
|
Add: amortization of acquired intangible assets |
|
|
66 |
|
|
|
50 |
|
Add: stock-based compensation |
|
|
970 |
|
|
|
3,043 |
|
Non-GAAP gross profit |
|
$ |
137,512 |
|
|
$ |
119,089 |
|
Gross margin, GAAP |
|
|
71.0 |
% |
|
|
68.6 |
% |
Add: amortization of acquired intangible assets |
|
|
0.0 |
% |
|
|
0.0 |
% |
Add: stock-based compensation |
|
|
0.5 |
% |
|
|
1.8 |
% |
Non-GAAP gross margin |
|
|
71.6 |
% |
|
|
70.4 |
% |
|
|
|
|
|
|
|
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|
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Three Months Ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
(unaudited) |
|
|
|
|||||
Operating expenses, GAAP |
|
$ |
159,057 |
|
|
$ |
160,287 |
|
Adjustments: |
|
|
|
|
|
|
||
Stock-based compensation |
|
|
(22,689 |
) |
|
|
(19,275 |
) |
Litigation-related expenses |
|
|
(525 |
) |
|
|
(12,214 |
) |
Amortization of acquired intangible assets |
|
|
(3,915 |
) |
|
|
(4,103 |
) |
Restructuring expenses |
|
— |
|
|
|
(371 |
) |
|
Non-GAAP operating expenses |
|
$ |
131,928 |
|
|
$ |
124,324 |
|
|
|
|
|
|
|
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ALPHATEC HOLDINGS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(in thousands)
|
|
Three Months Ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
(unaudited) |
|
|
|
|||||
Net loss, GAAP |
|
$ |
(33,906 |
) |
|
$ |
(51,907 |
) |
Cash interest expense, net |
|
|
4,953 |
|
|
|
5,356 |
|
Noncash interest expense, net |
|
|
6,768 |
|
|
|
2,485 |
|
Loss on debt extinguishment |
|
— |
|
|
|
17,576 |
|
|
Gain on derivative liability |
|
— |
|
|
|
(17,400 |
) |
|
Other income, net |
|
|
(446 |
) |
|
|
(337 |
) |
Income tax provision (benefit) |
|
|
50 |
|
|
|
(64 |
) |
Depreciation |
|
|
14,629 |
|
|
|
15,754 |
|
Amortization expense |
|
|
4,506 |
|
|
|
4,153 |
|
EBITDA |
|
|
(3,446 |
) |
|
|
(24,384 |
) |
Add back significant items: |
|
|
|
|
|
|
||
Stock-based compensation |
|
|
23,659 |
|
|
|
22,318 |
|
Litigation-related expenses |
|
|
525 |
|
|
|
12,214 |
|
Restructuring expenses |
|
|
— |
|
|
|
371 |
|
Adjusted EBITDA |
|
$ |
20,738 |
|
|
$ |
10,519 |
|
|
|
|
|
|
|
|
||
Adjusted EBITDA margin |
|
|
10.8 |
% |
|
|
6.2 |
% |
Adjusted EBITDA margin expansion |
|
|
460 |
|
bps |
|
||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
(unaudited) |
|
|
|
|||||
Net loss, GAAP |
|
$ |
(33,906 |
) |
|
$ |
(51,907 |
) |
Stock-based compensation |
|
|
23,659 |
|
|
|
22,318 |
|
Litigation-related expenses |
|
|
525 |
|
|
|
12,214 |
|
Amortization of acquired intangible assets |
|
|
3,981 |
|
|
|
4,153 |
|
Restructuring expenses |
|
— |
|
|
|
371 |
|
|
Loss on debt extinguishment |
|
— |
|
|
|
17,576 |
|
|
Gain on derivative liability |
|
— |
|
|
|
(17,400 |
) |
|
Non-cash interest expense |
|
|
6,768 |
|
|
|
2,485 |
|
Foreign currency exchange impact |
|
|
(429 |
) |
|
|
(312 |
) |
Long-term income tax rate adjustment |
|
|
(218 |
) |
|
|
2,811 |
|
Non-GAAP net income (loss) |
|
$ |
380 |
|
|
$ |
(7,691 |
) |
|
|
|
|
|
|
|
||
Non-GAAP net income (loss) per share |
|
$ |
0.00 |
|
|
$ |
(0.05 |
) |
Weighted average shares outstanding, basic and diluted |
|
|
154,051 |
|
|
|
146,732 |
|