Good day. Thank you for standing by. Welcome to CONMED's Q1 FY 2026 earnings conference call. Currently, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. Before the conference call begins, let me remind you that during this call, management will be making comments and statements regarding its financial outlook, its plans, and objectives. These statements represent the forward-looking statements that involve risks and uncertainties as those terms are defined under the federal securities laws. Investors are cautioned that any such forward-looking statements are not guarantees of future events, performance, or results.
The company's actual results may differ materially from its current expectations. Please refer to the risk and other uncertainties disclosed under the forward-looking information in today's press release, as well as the company's SEC filings for more details on the risks and uncertainties that may cause actual results to differ materially. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call, except as may be required by applicable law. You will hear management refer to non-GAAP or adjusted measurements during this discussion. While these figures are not a substitute for GAAP measurements, management uses these figures to aid in monitoring the company's ongoing financial performance from quarter to quarter and year to year on a regular basis and for benchmarking against other medical technology companies.
Adjusted net income and adjusted earnings per share measure the income of the company, excluding credits or charges that are considered by the company to be special or outside of its normal ongoing operations. These adjusting items are specified in the reconciliation supporting the company's earnings releases posted to the company's website. With these required announcements completed, I will turn the call over to Patrick Beyer, President and Chief Executive Officer, for opening remarks. Mr. Beyer.
Thank you. Good afternoon, and thank you for joining us for CONMED's Q1 2026 earnings call. With me on the call today is Todd Garner. The search for our new CFO is progressing well, and we look forward to providing you with an update soon. I asked Todd to join me today as he is assisting us as our advisor with our Q1 earnings report. I'll start and provide you with an update of our Q1 results and updates on our strategic priorities. Todd will then take you through the financials and our 2026 guidance in more detail before we open the call for your questions. Before turning to the quarter, I want to recognize our teams around the world for their continued focus and execution. Across the business, their work is making a real difference for our customers and for the company.
During the Q1 , we reached an agreement to divest certain GI products, and in April, we reached a second agreement to divest our remaining GI products. As is customary, we will providing transition services under TSAs through the end of this year and into 2027. This decision was intentional and strategic. It allows us to concentrate resources and investment on our higher growth, higher margin offerings and better focuses the organization on driving improved execution and delivering long-term shareholder value. I'll start by briefly reviewing our Q1 results. Total sales for the quarter were $317 million, a decrease of 1.3% compared to the prior year quarter. Excluding the impact of our previously announced exit from our gastroenterology product lines, total sales increased 3.8% year-over-year as reported and 2.1% in constant currency.
Orthopedics delivered sales growth of 4.5% on constant currency basis, while general surgery sales declined 7.4% in constant currency but were flat after adjusting for the gastroenterology exit. From an earnings perspective, excluding special items that affected comparability, our adjusted net income of $27.1 million decreased 8.5% year-over-year, and our adjusted diluted net earnings per share of $0.89 decreased 6.3% year-over-year. These were, of course, impacted by the exit of our GI business. I want to turn to our three key growth platforms: AirSeal, Buffalo Filter, and BioBrace. These platforms sit at the center of our long-term strategy and provide a durable foundation for growth and margin expansion.
Our decision to exit gastroenterology and place our strategic focus on minimally invasive surgery, smoke evacuation, and orthopedic soft tissue repair reflects our intent to allocate capital, talent, and attention toward the area where we see the greatest opportunity. I'll walk through each platform and highlight what we're seeing develop in the market. Starting with AirSeal, our clinical insufflation platform that is supported by two durable growth vectors, robotic and laparoscopic surgery. AirSeal benefits from a large installed base of over 10,000 systems globally, which continue to grow in Q1, giving us broad clinical presence and deep surgeon familiarity. AirSeal plays a critical role in complex procedures where conventional insufflation systems may be less reliable. AirSeal's clinical differentiation underpins its role in robotic surgery, particularly as these procedures continue to expand across subspecialties and migrate into ambulatory surgery centers. AirSeal follows surgeon preference.
Beyond robotics, the laparoscopic opportunity remains significantly under-penetrated. In the U.S. alone, more than 3 million laparoscopic procedures are performed annually, and today, AirSeal is used only in 6%-7% of those cases. We continue to see good traction in laparoscopy market, including continued growth in the Q1. Taken together, AirSeal's installed base, differentiation among high acuity specialists, importance in ambulatory environments, and expanding laparoscopic adoption support our confidence that AirSeal can deliver high single-digit to low double-digit growth over the long term. Turning to Buffalo Filter, our smoke evacuation platform, this continues to be one of our most compelling long-term growth opportunities. On the legislative front, we now have 20 U.S. states with smoke-free operating room laws on the books, covering approximately 51% of the population.
We continue to see additional states moving towards legislation and expect this trend to persist, giving the safety benefits for healthcare professionals. We are continuing to see traction internationally, particularly in the Nordic countries, Canada, and Australia. On the product side, our PlumeSafe X5, launched in the H1 2025, continues to gain traction. Its smaller footprint, quieter operation, and faster smoke clearance are resonating in outpatient and ambulatory environments. Importantly, we remain disciplined in how we are scaling this area. Our strategic focus is on direct smoke evacuation, where we control the customer relationship and capture the full margin profile. While OEM remains part of the portfolio, over time, we expect direct smoke to represent a larger share of smoke evacuation revenue, consistent with our broader focus on higher growth, higher margin opportunities.
Our third key growth platform is BioBrace, which continues to perform exceptionally well and remains a signature element of our sports medicine strategy. BioBrace is increasingly recognized by surgeons as a differentiated solution in soft tissue repair, addressing both the mechanical and biologic drivers of failure. It is the only FDA-cleared implant that delivers structural reinforcement while also promoting biologic healing, a combination that is reshaping how surgeons approach complex repairs. As surgeons gain experience with the technology, we are seeing broader utilization across both primary repairs and more complex cases. Clinical validations remain a critical component of the platform's long-term value proposition. There are currently over 30 published studies on BioBrace. Our 268 patient randomized controlled trial remains on track to complete enrollment in 2026, with publication expected in 2027.
In the interim, the growing body of existing clinical data, along with the American Academy of Orthopaedic Surgeons' guidelines recommending augmentation in rotator cuff repair, are reinforcing surgeon confidence and supporting adoption. We believe BioBrace is still early in its life cycle. As BioBrace becomes further embedded into surgical workflows and expands across additional soft tissue procedures, we see a long runway for sustained growth and increasing contribution to our orthopedics portfolio. From an operational standpoint, we finished 2025 strong and continued to improve supply chain performance during the 1st quarter. We are moving into a position in which we're able to provide customers with the consistent service they expect. This allows our orthopedic sales team to get back on offense and engage more proactively with surgeons and accounts. To support this momentum, we continue to expand capacity across both our internal manufacturing footprint and through qualified external partners.
This dual approach gives us greater flexibility, improved resilience, and positions us to support sustained growth. Importantly, these improvements are now showing up in our results. Orthopedics delivered mid-single-digit growth in the Q1 , marking the third consecutive quarter of at least mid-single-digit growth, a trend that reflects improving supply reliability alongside continued strength in our core platforms. We are making sustained progress, and we believe we are on a clear path toward where we ultimately wanna be, operating a more durable, high-performance supply chain that can support long-term growth. Our capital allocation priorities remain unchanged. We continue to balance organic investment in innovation, manufacturing, and commercial effectiveness, disciplined acquisitions that strengthen our existing platforms, and returning capital to shareholders, supported by strong and consistent cash generation. Our balance sheet continues to strengthen, and we believe CONMED is well-positioned to invest in our business while maintaining financial discipline.
In summary, we enter 2026 with a focused portfolio, improving execution, and differentiated growth drivers operating in attractive markets. We remain committed to delivering reliable performance and creating long-term value for our shareholders. With that, I'll turn the call over to Todd, who will provide a more detailed analysis of our Q1 financial performance and discuss our 2026 financial guidance. Todd?
Thank you, Pat. All sales growth numbers I reference today will be given in constant currency. The reconciliation of GAAP to constant currency is included in our press release. The organic numbers referenced exclude GI sales from 2025 and 2026. As usual, we have included an investor deck on our website that summarizes the results of the quarter and our financial guidance. It also includes a reconciliation of GAAP to constant currency organic growth. For the Q1 2026, our total sales decreased 2.9% year-over-year. Organic sales increased 2.1% year-over-year. For Q1, total sales in the U.S. decreased 5.8% versus the prior year quarter, and total international sales grew 1.0%. Organic sales in the U.S. increased 2.8%, and organic international sales grew 1.3%.
Total worldwide orthopedic sales grew 4.5% in the Q1 . Total U.S. orthopedic sales increased 5.5%, and internationally, orthopedic sales increased 3.9%. Total worldwide general surgery sales decreased 8.5% in the quarter. Organic worldwide general surgery sales were flat over prior year. Total U.S. general surgery sales decreased 10.4%, while total international general surgery sales decreased 3.8%. Organic U.S. general surgery sales increased 1.5%, while organic international general surgery sales decreased 3.3%. AirSeal and Direct Smoke both grew in Q1, and we continue to expect AirSeal and Direct Smoke to be in the high single-digit to low double-digit range for the full -year.
As expected and included in our original guidance for the year, in Q1, both product lines were below our expected range for the full- year. We are seeing positive signs with AirSeal as more capital units entered the market in Q1 than robotic systems from the market leader. We are also seeing good early returns from our increased focus on laparoscopic procedures. The data points we can see give us confidence that AirSeal should continue to grow in the high single-digit to low double-digit range in 2026. The OEM smoke products were again a meaningful headwind in Q1. These non-focused products for us can be very lumpy quarter- to- quarter, and that was the biggest drag on general surgery sales in Q1. Let's move to the expense side of the income statement.
We will discuss expenses and profitability in the Q1, excluding special items which are detailed in our press release. Adjusted gross margin for the Q1 was 57.4%, which is 100 basis points higher than the prior year quarter, driven by favorable product mix and positive foreign currency impact. Adjusted research and development expense for the Q1 was 4.8% of sales, 80 basis points higher than the prior year quarter. This increase was driven primarily by increased investment into our key growth drivers. First quarter adjusted SG&A expenses were 40.0% of sales, 130 basis points higher than the prior year quarter. As we said in January, we expect the Q1 to be the highest quarter of the year. On an adjusted basis, interest expense was $5.8 million in the Q1.
The adjusted effective tax rate in Q1 was 24.2%. Q1 GAAP net income was $13.8 million, compared to $6.0 million in 2025. GAAP earnings per diluted share were $0.45 this quarter, compared to $0.19 a year ago. Excluding the impact of special items, in the Q1, we reported adjusted net income of $27.1 million, a decrease of 8.5% compared to the Q1 2025. Our Q1 adjusted diluted net earnings per share were $0.89, a decrease of 6.3% compared to the prior year quarter. Turning to the balance sheet.
Our cash balance at March 31 was $35.0 million, compared to $40.8 million at December 31. Accounts receivable days at March 31 were 65 days compared to 62 days at March of 2025 and 60 days at December 31. Inventory days at quarter end were 246 compared to 222 days a year ago and 207 on December 31. As we continue to focus on service levels, we have purposely built more inventory. Long-term debt at the end of the quarter was $860.2 million versus $834.2 million as of December 31. Our leverage ratio on March 31 was 3.1x .
Q1 is typically our biggest cash outlay, and we continue to expect this ratio to hold at roughly three times as we balance debt leverage and share buybacks. In Q1, we bought back approximately 858,000 shares for a total of $37.4 million. Cash flow provided from operations in the quarter was $13.5 million compared to $41.5 million in the Q1 2025. Capital expenditures in the Q1 were $2.9 million compared to $3.8 million a year ago. We continue to expect operating cash flow for the full- year to be between $145 million and $155 million and capital expenditures between $20 million and $30 million, resulting in free cash flow around $125 million.
No change from our prior guidance at the beginning of the year. Let's turn to financial guidance. We'll start with revenue. We are pleased to be able to raise our organic growth expectation for 2026 to 5.0%-6.5% from our prior range of 4.5%-6.0%. Patrick outlined the good signals we are seeing in the business, and we are pleased with the improving outlook. Currency has also improved slightly, and we now expect foreign exchange rates to be a tailwind to revenue of between 40 basis points and 50 basis points. When we provided initial 2026 revenue guidance in January, we had recently announced our strategic intention to exit the GI product lines, but the only transaction that was complete was the agreement with Gore that was announced in December.
In January, we did not have clarity on how or when we would exit the remaining product lines, and our guidance included that lack of clarity. In March, as Pat said, we closed on the sale of certain GI products to Micro-Tech, and in late April, we closed on the sale of the remainder of our GI portfolio to a strategic acquirer who we will be able to disclose in the coming few weeks. As Pat said, these agreements include a period of us providing product and services that may likely extend beyond 2026. We now have much better clarity on what to expect for the remainder of 2026. In January, we estimated that we would sell between $21 million and $25 million of GI product lines in 2026.
With these two agreements complete and happening faster than originally anticipated, our 2026 revenue guidance for the GI product lines is now between $14.5 million and $17.5 million, which is about a $7 million reduction from our prior guide at the midpoint. Fortunately, the lower revenue also comes with lower costs, our EPS guidance of $0.45-$0.50 impact for the full- year is still consistent with our January expectations. Because of our improving growth profile, despite that approximate $7 million of lower GI revenue for the year, we are raising the lower end of our reported range by $5 million and keeping the high end of the range the same. That results in expected reported revenue between $1.35 billion-$1.375 billion for 2026.
We expect reported revenue in Q2 to be between $336 million and $340 million. We've provided a detailed look at the assumptions of the organic growth and currency impact for the remainder of the year in our investor deck. We expect to refinance our debt during Q2 before the outstanding convertible notes go current. We have strong banking partners, and we are seeing attractive rates and plenty of capacity available to us. Given the historic trough in med tech multiples, we have determined that issuing new convertible notes at this time would not be in the best interest of CONMED shareholders. Our intent is to refinance with bank debt, which we expect could increase our full-year adjusted interest expense, impacting adjusted EPS for the full- year by at least $0.10.
Despite this increase, thanks to the strength and the profitability we saw in Q1 and the increase in our organic growth profile, we are able to keep our adjusted EPS guidance for the full- year unchanged at the range of $4.30-$4.45. For Q2, we expect adjusted EPS to be between $1.09 and $1.14. With that, we'd like to open the call to your questions. Operator?
Our first question comes from the line of Travis Steed of Bank of America. Your line is open, Travis.
Hey, this is Grace on for Travis. Thank you for taking the questions. The first one, I wanted to ask a little bit more about the debt refinancing that you called out that you're starting in Q2, and just a little bit more about the strategy and what levers you can do to mitigate potential EPS dilution, both in 2026 and also in 2027 as well. I had one follow-up.
Sure. Thanks, Grace. We're starting those discussions with our banking partners. We have a very strong banking group, some of the best banks in the world. We have ample capacity. We're seeing good rates. The change from what we thought, what we planned for the full year is we thought that there would be a mix of bank debt and convertible notes. That was in the prior original kind of intention. As we look at the, you know, historic low multiples in med tech, we determined that it was not in best interest of CONMED shareholders to do new convertible notes at this time. That raises the cost of capital just a little bit. As I said in my script, we see that as at least $0.10. I'm not being terribly precise there, obviously, because the negotiations are not done.
We don't know exactly how, you know, what we're gonna get. There's a lot of year left in cash flows and what the rates may do. It's gonna be more than we originally thought as we laid out 2026. Thankfully, the strength in the business, the results of Q1 allow us to keep EPS the same, despite that increased headwind from interest expense.
Great. Helpful. Thank you. The second one, earlier this morning, just saw a company come out and talk about inflationary pressure. I think that's top of mind. Just sort of wondering what you're seeing on the macro front in terms of inflation impacting margins and any framework to think about how that could impact CONMED over the rest of the year and what is sort of implicit in your margin guide there as well. Thank you.
Hi, Grace. Pat here. Thanks for the question. Again, any macro, geopolitical or economic, margin pressure or price pressure would be included in guidance. Just want to let you know that. We are seeing some pressure on some commodity products like oil, gold. They're affecting our cost of goods sold, but we're working hard with our vendors and our partners and our supply chain to mitigate as much as we can there. At a macro level, we're seeing some component prices go up. We're partnering with our supply chain to mitigate those, and we're also partnering with our hospital systems to partner with them on cost-effective clinical solutions. We don't expect any more other macro influences on the cost side to impact our guidance here. We've included that in there.
Thank you. Our next question comes from the line Ross Abram of Wells Fargo. Your line is open, Ross.
Hi. Good afternoon, and thanks for taking our questions. Starting out with AirSeal, and apologies if I missed this, but what was the attach rate to DV5 during the quarter?
Hi, Ross. Pat here, and welcome. We did not state the attachment rate for the quarter. What I would say to you is the attachment rate for AirSeal in Q1 followed the guidance that we have given in the past. That was on the dV5 we have guided between 10% and 20%, and we continue to be in that zone, Ross.
Okay. Sounds great. For my second question, you know, what is your level of visibility into state legislation by the peri-ORs at all this year?
Um, I'm-
That may result in a tailwind?
I'm sorry about that. You're talking about smoke evacuation?
Yes. Just curious, you know.
Yes.
Regarding guidance, how much is baked in for new states coming on board?
Anything would have been built into it. I think we've stated 20 states have enacted 45% of the hospitals in the U.S., 51% of the population. We have line of sight of 13 additional states have bills pending. We believe Maryland and Massachusetts are the most likely ones to pass. In fact, Maryland's actually at the governor's desk. We continue to see legislation play a role in the background as well as the clinical benefits of it. Societies continue to play as equal or more important role as societies like AORN are pushing for legislation and action from hospitals to standardize on smoke evacuation.
Thank you. Our next question comes from the line of Robbie Marcus of JP Morgan. Please go ahead, Robbie.
Oh, great. Congrats on a nice quarter. Two from me.
I'm hoping you could walk us through the bridge on second quarter. It seems like a larger than normal step up in dollars. I realize the last few years maybe aren't the best proxies for Q1- Q12. I know Q2 is historically a stronger quarter. Maybe just give us a bridge of how you get there on a dollar basis. You know, what's getting better and how to think about that. Then I have a follow-up.
Sounds good. Todd can talk you through the dollars, and then if there's any questions on the background clinical spaces, I'll jump in on that side.
Yeah. I know. Look, you know, we're only half an hour from releasing the deck on our website, but Robbie, I do wanna make sure you see the deck. Specifically, I think it's Slide 5. We provided much more granularity on the pieces of organic, the GI sales and currency. That'll just give you some extra visibility. I would say in general, you know, if you remember, Q4 was a pretty strong quarter for us. Because of that, we were pretty cautious on the Q1 guide. It came in better than we expected, but we were right in that Q1 was a little softer because Q4 was so strong, particularly internationally.
It is true that we are expecting to see an acceleration in Q2 better than what we saw in Q1, but I think that fits with, you know, how we saw the year to start with, and the signals we're seeing in Q1 have given us confidence that the Q2 numbers are in a good place.
Yeah. I see the slide. I guess I'm asking what businesses are getting better? You know, 'cause it's just, it's a larger dollar amount from Q1 to second quarter, especially, with the GI numbers going down year-over-year. I was wondering if you could kinda give us a bridge. What's getting better in second quarter to get us to that dollar amount?
Robbie, I'm going to be focused on the growth drivers. Our orthopedic business and BioBrace will continue to accelerate its growth. We will continue to work through our supply chain historical challenges that have gotten a lot better, and we're moving more towards on offense. You can expect the orthopedic business to continue to accelerate, number 1. Number 2, we called out that international would be much slower in the Q1 because of the big Q4 they had. Their absolute value dollars will accelerate in Q2 . You're gonna see the natural drivers of AirSeal and our smoke evacuation from a dollar standpoint and a growth standpoint accelerate there.
The AirSeal business, although it grew, the absolute growth wasn't as much as we would have liked to have seen, but the absolute capital units that have hit the market were pretty attractive for us, and they accelerated in Q1 , and we expect to see the disposable trends grow in Q2 and throughout the year. That'll also play a role in accelerating that absolute dollar growth value from Q1- Q2, Robbie.
Perfect. Then just quickly on gross margin, you had a really good result, your best one in, you know, many quarters. any color there and just how to think about that through to Q3 or Q4? Thanks.
Yeah. Thanks, Robbie. We grew 100 basis points over the prior year quarter. Our full- year guide for gross margin was 50 basis points- 100 basis points for the year. We were at the top end of that for Q1. As we look at the rest of the year, we think we should be in that 50 basis points- 100 basis points every quarter. Q1 was good at the top of the range, and we continue to have the guide of 50 basis points - 100 basis points of improvement in 2026.
Thank you. Our next question comes from the line of Matthew O'Brien of Piper Sandler. Please go ahead, Matthew.
Okay. This is Anna on for Matt. Thanks for taking the questions. I want to touch on the laparoscopic opportunity in AirSeal specifically. I know you've mentioned that market penetration is fairly low there for a while now. I'm just wondering, you know, what the gating factor is there and how we should think about the laparoscopic application as a growth driver long term for AirSeal. You know, any investments you're making to accelerate penetration into that market.
Thank you. As we think about laparoscopy, historically, we've done a strong job internationally, where the robotic penetration was lower, internationally was selling AirSeal in the laparoscopic market successfully. We know there's an economic and clinical benefit to the hospital systems and patients around the world. To give some detail on the U.S., there are over 3 million procedures in the U.S. laparoscopically, and we have a penetration rate of about 6%-7%. We have strong programs in the United States towards standardization in the laparoscopic market. We know that the clinical benefit and the economic benefit is there. We're taking a pretty focused approach. For example, in the laparoscopic market. Two procedures, colorectal and hysterectomy, have over 350,000 procedures done laparoscopically. These are complex surgeries in nature.
They're three hours plus in length of procedure, and we know the benefits of AirSeal and stable, low pressure clinical insufflation make a real difference. We have an active program in the U.S. around standardization and laparoscopy. We had a good Q1 where our pipeline is growing strongly. I commented that the actual units of AirSeal going into the market in the U.S. was really strong in Q1. We put over 50% more in Q1 in the market than we did in Q1, 2025. Some good moves are happening there.
Awesome. That's great to hear. Super helpful. I also just wanted to ask on the supply chain, just any additional color on the progress you've made there. You know, once these issues are fully subsided, I'd imagine it might take some time for you to recoup any lost business or any dislocated business. Just wondering if there's, you know, an expected lag there and when you expect to fully be back on offense, with the supply chain issues.
Appreciate the question. I'll remind you that at the end of 2025, we said we made real progress. The good news was it wasn't a moment, it was a movement, and we've continued to make progress. The gains we made at the end of 2025, we've sustained. That's number one. Number two, it's allowed us to grow our orthopedic business, and we commented that we've had three quarters in a row where we've actually achieved minimum mid-single digits growth. The good news is BioBrace had never gone on back order. Our sales professionals, even though they weren't on offense on our core orthopedic product lines, they were connecting with clinicians, taking care of clinicians' clinical issues, and maintaining their relationships.
We believe that while we will not take all of the previous business we may have lost back quickly, we believe our relationships are strong with the hospitals. As contracts continue to come up and we have opportunities, we'll continue to take the appropriate market share that we deserve and we've earned. Again, would remind you, the sports medicine market is a large market growing mid-high single digits, and our expectation is we're a winning company and we would expect to, over time, move to that mid-single digit, high single-digit growth trajectory.
Thank you. Once again, to ask a question, please press star one one on your telephone. Again, that's star one one to ask a question. Our next question comes from the line of Mike Matson of Needham & Company. Your line is open, Mike.
Yeah, thanks for taking my questions. Just on Buffalo Filter, the OEM business, is there any way you can help us understand how big of a part of Buffalo Filter that general surgery business that is? You know, what's the expectation around when that stops potentially being a drag on Buffalo Filter overall? Like, when does it kind of get small enough or level off in terms of the declines?
Mike, the Buffalo Filter piece of our smoke evacuation is smaller than our Direct Smoke number one. We grew our Direct Smoke business in Q1, and we believe over time it will continue to get smaller. We believe the leading indicators we saw in Q1 tell us that total smoke will, in 2026, be high single digits, low double digits.
Okay
it'll fade away, and we'll continue to focus on our direct business.
All right. Just on the interest expense commentary. It sounds like you're saying that it's gonna be, and I know it's rough numbers at this point, but approximately $0.10 greater impact from the added interest expense than you previously expected, but you're able to kind of absorb that and you're maintaining the EPS guidance. I guess looking into 2027 then, and I know you're not giving guidance for 2027, obviously, but I mean, is it's probably gonna kick in mid-year, is that like a $0.20 annualized impact that you know, and would that $0.20, you know, be kind of a headwind in 2027?
Yeah. Fair question, Mike.
Fair question.
We don't want to get ahead of ourselves. Obviously, you know, we said that with where things are right now, we've determined to not access the convertible part of the market. That doesn't mean that we, you know, we wouldn't between now and 2027, right? There's a lot of things that can move between now and then. We have a very strong cash engine and, you know, we'll give 2027 guidance at the right time. You know, I'd ask you to just kind of stay open-minded to where this goes. I will remind you, we said at least, 'cause, you know, this is still a little bit of a moving target, we don't want to be too precise with it, and we certainly don't want to be precise into next year.
Thank you. I would now like to turn the conference back to Patrick Beyer for closing remarks. Sir.
Thank you, Latif. I wanna thank everybody for joining us on the call. We entered 2026 with a clear focus on execution. We are concentrating on our key growth platforms and continuing to build a strong foundation for long-term performance. Exiting the GI portfolio further sharpens our focus and positions CONMED as a more disciplined company going forward. I'm really proud of our team and the positive impact they're having on patient outcomes, as well as their continued commitment to creating value for our shareholders. Thank you for joining us today, and I want to thank you for your continued interest and support.
This concludes today's conference call. Thank you for participating. You may now disconnect.