Smith & Nephew plc reported total revenue of $1,501 million for the third quarter of 2025, a 5.0% increase in underlying revenue growth. The figure fell short of the $1,512 million consensus and the 6.2% underlying growth expected by analysts, marking a miss of $11 million and 1.2 percentage points. Year‑over‑year, revenue rose 6.7% from $1,412 million in Q3 2024, but the underlying growth rate slowed from 4.0% in the same period last year, indicating a deceleration in the company’s top‑line momentum.
Segment analysis shows that orthopaedics grew 4.1% in underlying revenue, below the 5.1% reported by the company, while sports medicine and ENT grew 5.1% versus the 6.4% reported. Advanced wound management posted 6.0% growth, slightly under the 7.8% reported. The weaker performance in orthopaedics and sports medicine was driven by a slowdown in U.S. knee‑implant sales and a slower‑than‑expected recovery in sports‑medicine demand, which offset the stronger growth in wound‑care products.
Operating profitability remained resilient. Management guided for a full‑year underlying revenue growth of about 5.0% and a trading profit margin of 19.0%–20.0%, up from the 18.1% margin reported in 2024. Free‑cash‑flow guidance was increased to roughly $750 million, a significant lift from the previous $600 million‑plus target, reflecting disciplined working‑capital management and the ongoing benefits of the 12‑Point Plan.
Chief Executive Officer Deepak Nath emphasized that the quarter’s results demonstrate the continued impact of the 12‑Point Plan, noting that “our third‑quarter results again demonstrate how the 12‑Point Plan has improved Smith+Nebhew’s revenue growth profile, keeping us on track to meet our full‑year outlook for revenue growth and a step‑up in trading profit margin.” He added that new products are driving higher revenue growth and that the company is pleased to raise its free‑cash‑flow guidance, underscoring confidence in its cash‑generation capability.
Investors reacted to the revenue miss and the lower‑than‑expected underlying growth, particularly the weakness in sports‑medicine and knee‑implant segments. Headwinds such as a $15–$20 million net tariff impact in 2025 and challenges in emerging markets were highlighted, while tailwinds included the launch of new products and the continued momentum from the 12‑Point Plan. The raised free‑cash‑flow guidance signals management’s optimism about operational efficiency and working‑capital discipline.
Looking ahead, Smith & Nephew maintains its full‑year outlook for underlying revenue growth and trading profit margin, while raising free‑cash‑flow expectations. The company’s upcoming Capital Markets Days in London and New York will further detail its strategy and mid‑term priorities, reinforcing its commitment to sustaining growth and profitability in a competitive medical‑technology landscape.
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