Thank you for standing by. Welcome to CONMED's Third Quarter Fiscal 2025 Earnings Conference Call. 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 risks 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 also hear management refer to non-GAAP or adjusted measurements during this discussion. While these figures are not a substitute for GAAP measures, 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 Pat Beyer, President and Chief Executive Officer, for opening remarks. Mr. Beyer?

Thank you, operator. Good afternoon, and thank you for joining us for CONMED's Third Quarter 2025 Earnings Call. With me today is Todd Garner, our Executive Vice President and Chief Financial Officer. I'll begin with a review of our performance in the quarter. Todd will then walk through our financial results and guidance in more detail. We will then open the call to your questions. Before I dive into the quarter, I want to take a moment to recognize the continued dedication of our global team. Their commitment to our mission, empowering health care providers worldwide to deliver exceptional outcomes for patients is what drives our performance and enables us to navigate change with confidence. Turning to our third quarter results. Total sales were approximately $338 million. This represents 6.7% growth year-over-year as reported and 6.3% growth in constant currency. Performance was led by general surgery, which grew 6.9% globally on a constant currency basis and orthopedics, which delivered 5.3% constant currency growth globally. From an earnings perspective, adjusted net income for the quarter was $33.4 million, up 2.2% year-over-year, excluding special items that affected comparability. Adjusted diluted earnings per share came in at $1.08, an increase of 2.9% compared to the prior year quarter. Let me now turn to the platforms that continue to anchor our growth strategy and deliver differentiated durable performance across the business. I'll begin with BioBrace and Foot and Ankle, two foundational growth drivers within our orthopedics portfolio. BioBrace continues to be a cornerstone of our sports medicine strategy. Quarter 3 growth was driven by expanding clinical adoption and strong surgeon engagement. BioBrace is now used across 70-plus distinct procedures from rotator cuff and ACL repairs to Achilles and gluteus medius reconstructions, underscoring its versatility and clinical relevance. Turning to our Foot and Ankle franchise. We see continued opportunity in this clinical area and will remain focused on driving growth and delivering strong economic returns through expanded adoption and portfolio innovation. Shifting to our general surgery portfolio, I want to highlight two platforms that continue to demonstrate strong performance and long-term potential, Buffalo Filter and AirSeal. Starting with Buffalo Filter, we're seeing sustained momentum driven by expanding legislative mandates, heightened awareness of surgical smoke risks, and deeper integration to hospital protocols. Moving to AirSeal. This platform remains a foundational pillar of our general surgery portfolio. The clinical benefits, reduced postoperative pain, shorter length of stay, and improved outcomes are well established and continue to resonate with surgeons. As DV5 adoption expands in the U.S., we continue to see AirSeal attachment rates within our range of expectations. We're also closely monitoring the potential redeployment of Xi system trade-ins into international markets and into United States ASCs. While still early, we view this as a promising opportunity to accelerate AirSeal growth globally, particularly in regions where Xi placements are increasing and AirSeal's clinical advantages are well understood. Stepping back, one of my first priorities, as CEO after more than a decade with CONMED, was to initiate a comprehensive strategic review of our portfolio and operations. To support this effort, we engaged top-tier consultants to bring a fresh perspective on where we are today, where our greatest opportunities lie, and how we can deliver the strongest long-term returns for shareholders. While the review is still underway, I want to share some early insights. Our evaluation has been detailed and rigorous, assessing each product offering through the lens of long-term return on invested capital. The objective is clear: sharpen our focus, improve our margin profile, and position CONMED for durable long-term growth. For a company of our size, CONMED has a diverse set of product lines. Early findings confirm that our strongest growth opportunities lie in our core markets, minimally invasive robotic and laparoscopic surgery, smoke evacuation, and the surgical treatment of orthopedic soft tissue repair. We are positioned to capitalize on these opportunities through a portfolio of best-in-class clinical solutions, including AirSeal, Buffalo Filter, and BioBrace, which is gaining momentum through its expanding application within Foot and Ankle procedures. These platforms will be the cornerstone of our future investments in growth and profitability, enabling CONMED to drive superior clinical outcomes for patients while delivering meaningful improvements in health care economics. As part of our evolving capital allocation framework, we are transitioning the cash return to shareholders from our legacy dividend policy to prioritize share repurchases. The Board has authorized a new $150 million share repurchase program. Historically, we have returned approximately $25 million annually through dividends. Today, we are suspending the dividend, and you should expect at least $25 million of share repurchases annually going forward. This change enhances our financial flexibility and supports disciplined capital deployment aligned with long-term shareholder value creation. In conclusion, we remain confident in our ability to deliver both top line growth and margin expansion, supported by a focused portfolio, operational discipline, and a commitment to innovation. With that, I'll turn the call over to Todd, who will provide a more detailed analysis of our Q3 financial performance and discuss our 2025 financial guidance. Todd?

Thank you, Pat. All sales growth numbers I reference today will be given in constant currency. The reconciliation to GAAP numbers is included in our press release. As usual, we have included an investor deck on our website that summarizes the results of the quarter and our financial guidance. For the third quarter of 2025, total sales increased 6.3% year-over-year. The quarter included one extra selling day, which we estimate contributed between 100 and 150 basis points to growth. For Q3, our sales in the U.S. increased 5.9% versus the prior year quarter, and our international sales grew 6.8%. Total worldwide orthopedic sales grew 5.3% in the third quarter. In the U.S., orthopedic sales increased 5.5%, and internationally, orthopedic sales increased 5.2%. Total worldwide general surgery sales increased 6.9% in the quarter. U.S. general surgery sales grew 6.0%, while internationally general surgery sales increased 9.2%. Now let's move to the expense side of the income statement. We will discuss expenses and profitability in the third quarter, excluding special items, which are detailed in our press release. Adjusted gross margin for the third quarter was 56.1%, which was ahead of our projection due to positive sales mix. As a reminder, the Q3 results reflect the expenses that went into inventory in Q1 when our manufacturing variances were high. This drove a 40 basis point decline in gross margin compared to Q3 of 2024, including 20 basis points of headwind from new tariffs. Research and development expense for the third quarter was 4.1% of sales, 20 basis points lower than the prior year quarter. Third quarter adjusted SG&A expenses were 37.3% of sales, 10 basis points higher than the prior year. On an adjusted basis, interest expense was $6.3 million in the third quarter. The adjusted effective tax rate in Q3 was 25.5%. Third quarter GAAP net income was $2.9 million compared to $49.0 million in 2024. GAAP earnings per diluted share were $0.09 this quarter compared to $1.57 a year ago. Excluding the impact of special items discussed earlier, in the third quarter, we reported adjusted net income of $33.4 million, an increase of 2.1% compared to the third quarter of 2024. Our Q3 adjusted diluted net earnings per share were $1.08, an increase of 2.9% compared to the prior year quarter. Turning to the balance sheet. Our cash balance at September 30 was $38.9 million compared to $33.9 million at June 30. Accounts receivable days as of September 30 were 60 days, down from 62 days at the end of Q2. Inventory days at September 30 were 191, down from 212 days at the end of June. Long-term debt at the end of the quarter was $853.0 million versus $881.1 million as of June 30. Our leverage ratio stood at 3.0x as of September 30, reaching that milestone slightly ahead of expectations for the year, which, as Pat explained, provides us additional flexibility to return cash to shareholders through share repurchases. Cash flow provided from operations in the quarter was $53.7 million compared to $51.2 million in the third quarter of 2024. Capital expenditures in the third quarter were $5.2 million compared to $3.4 million a year ago. Now let's turn to financial guidance. Let's start with revenue. We're guiding Q4 revenue to be between $363 million and $370 million, which represents mid-single-digit constant currency growth for the total company with about 100 basis points of tailwind from currency. That would put the full year 2025 reported revenue guidance at a range of $1.365 billion to $1.372 billion, which is a narrowing from the prior range. FX is still projected to be essentially neutral for the full year 2025. We continue to project adjusted gross margin in Q4 to be in the mid-55% range, inclusive of about 150 basis points of headwind from the new tariffs in 2025. Turning to adjusted EPS. We expect Q4 to be between $1.30 and $1.35, which would put the full year guidance at a range of $4.48 to $4.53 compared to the prior guidance range of $4.40 to $4.55. So far, 2025 has been a year of solid execution amid meaningful strategic transformation work. As Pat mentioned, our portfolio review is ongoing, and we're already seeing early benefits from a more focused approach. We believe the work done in 2025 positions CONMED to be a stronger, more profitable company over the long term. With that, we'd like to open the call to your questions.

Our first question comes from Robbie Marcus of JPMorgan.

This is actually Lily on for Robbie. Maybe I'll start with one on capital allocation and suspending the dividend. Can you talk a bit more about what drove that shift in capital allocation strategy? And should we be expecting any other changes to your thinking and strategy on M&A or debt pay down?

Great question, Lily. Thank you. No other changes. You should not expect any other changes. We worked with our banking partners. We looked at our peer set, medical device companies our size. We're one of the very few to pay a dividend. Maybe one of the more common questions I get these days is with the stock where it is, why the company is not buyers of our own stock. I've answered over the last couple of years that we feel like we've had to prioritize getting leverage down. And when I've given that answer, I think investors have almost unanimously agreed with those priorities. Now that we've reached the 3.0 mark, which has been kind of the target, we've reached it a little sooner than we thought. We thought now would be a good time to make that exchange and fit in more with the peer set and what's expected in our market and in our size and return cash to shareholders through share repurchases instead of dividends.

Great. That's helpful. And then I was hoping to get some early thoughts on 2026. I know you're not guiding yet, but there are some moving pieces here. So can you talk about how you're thinking about supply and your ability to fully meet demand next year? And any other important headwinds or tailwinds to be keeping in mind?

I certainly appreciate the attempt, and I know all of our interest is quickly moving to 2026. We're going to guide 2026 at the appropriate time when the year starts. So we're not going to get into that, and I don't have anything to call out for you at this time.

Our next question comes from the line of Matt O'Brien of Piper Sandler.

This is Anna on for Matt. So I guess I just want to ask one on tariffs. If there was any incremental tariff headwind versus what you expected before. In the press release, you commented on $0.09 in the back half in Q2, and now you're expecting $0.07 in Q4. So did this become a larger headwind sort of incrementally? Or what's the thought process there?

Great question, Anna. Thank you for that question to make sure we're clear. So this has been consistent. So we started seeing a couple of quarters ago, we forecasted that Q3 would be about $0.02 and Q4 would be about $0.07. The reason we have been so accurate with that is because tariffs go into our manufacturing variances, which travel with inventory and then get released in the external P&L with that revenue, which for us is about a 6-month deferral. So the tariffs you're seeing hit the P&L in the back half of '25 are actually the tariffs from calendar Q1 and Q2 of '25. And so that has been consistent with how we projected it. So Q2 of 2025 was $0.07, and that's what's being recognized in Q4 of 2025.

Great. That's super helpful. And then I believe DV5's manufacturer on their quarterly call mentioned a 90% utilization rate of their insufflator in the quarter. So in your view, what keeps that from going to 100%? And then where does AirSeal fit into the picture there?

Good question. This is Pat here. If you recall from last quarter, we indicated that the procedure rates with DV5 are between 80% and 90%. The clinical advantages of AirSeal, such as shorter hospital stays and reduced pain, are also relevant for DV5 procedures performed in Xi. We are noticing that the early adoption of AirSeal with DV5 is somewhat limited due to the requirement for hospitals to commit to a specific volume of procedures with DV5. In the overall market, nearly 90% of DV5s are in circulation. However, hospitals that have DV5s and are fulfilling their commitment volume are operating in the 80% to 90% range. This aligns with what we previously stated. Additionally, we continue to learn daily from this experience. It is clear that when clinicians utilize AirSeal alongside DV5, they are providing enhanced clinical benefits for their patients.

Our next question comes from the line of Vik Chopra of Wells Fargo.

Congrats on a nice quarter. A couple for me. So maybe one just on AirSeal. I mean, I think you talked in your comments about Xi systems being put into international markets and into the ASCs. I'm just curious how you're thinking about the adoption rate in ASCs in the U.S. and how you're thinking about international markets? And then I had a follow-up, please.

Yes. Vik, when I consider Xis, it's clear that they require an external insufflator. There is a proven history of Xis benefiting from the clinical advantages of AirSeal. Additionally, when an Xi is utilized in an ASC, having a shorter length of stay is very important. We believe that the benefits of AirSeal, which include reduced pain and shorter length of stay, will be evident in ASCs and will also be reflected in the international markets we're currently observing.

Got it. That's super helpful. And I'm just curious, if you can elaborate on the specific initiatives that strengthened your supply chain in the third quarter and how you intend to either maintain or enhance these improvements through 2026?

Vik, we started talking about it at the end of last year that we had to improve our supply chain, specifically in our orthopedic world. We commented in quarter 1, we had an outside consultant come in and help us. We've made progress in quarter 1. We made progress in quarter 2. In quarter 3, we had record manufacturing volumes for our orthopedic products. And also, we had a record reduction in the critical SKUs associated to getting our orthopedics business back on offense. I would characterize it as we made progress. We're not there yet. We expect to make continued progress in quarter 4. And the key things we're working on are systems and enhancements to our procurement, our planning and our production area.

Our next question comes from the line of Young Li of Jefferies.

I was wondering if you can maybe kind of give on sort of the U.S. AirSeal non-robotic laparoscopic opportunity, if you guys have been making any headway in that channel? And then also maybe a similar question just for U.S. now Intuitive robotic attachments, Hugo, CMR, like Asian. I'm just wondering how is the attachment rate for those categories?

That's a great question. I'll address it in two parts. Firstly, regarding the AirSeal attachment for international robots that are not DV5, we recently attended a meeting in Strasbourg, France, held by the Global Society of Robotic Surgery. There are several robotic systems entering the market, suggesting a promising future for robotic surgery beyond DV5 and Intuitive. This also highlights the pioneering work Intuitive has done in showcasing the clinical advantages of robotic surgery. As you know, DV5 includes an integrated insufflator, while other robotic systems require an external insufflator attachment. In international markets, we're observing the known clinical benefits of AirSeal, such as shorter hospital stays and reduced pain, being utilized with non-DV5 robots. Now, shifting to your second question about the United States, we see a strong potential in the laparoscopic sector, which encompasses non-robotic procedures. As mentioned last quarter, over 2 million procedures are performed laparoscopically. There are also longer laparoscopic cases where AirSeal is demonstrating its clinical benefits, and our U.S. commercial teams are increasingly focusing on this area. Apologies for the mix-up earlier by addressing you as Vik.

No worries. It's an honor to be confused for Vik.

I'll make it up to you in London.

Okay. Yes. Looking forward to seeing you there. Just a follow-up, I guess, just on the orthopedic side, I guess, kind of two-parter. Just maybe following up on ortho supply questions. Can you maybe comment a little bit about your latest thoughts on share loss and your ability to recapture share once these supply chain issues are resolved hopefully by year-end or early next year? And then on BioBrace, I think you said 70-plus procedures. That's a pretty big jump. I think last quarter, you called out 52. What triggered such a big jump type of procedures and where that can go?

Young, I have a couple of points to make. It was a bit difficult to hear you at the start. Regarding the number of procedures, the advantage of BioBrace is its approval for use where tissue weakness exists, and it provides clinical benefits in terms of strength and healing. This allows surgeons to expand its application to areas where they previously couldn’t use other products. The increase in procedures from the 50s to the 60s and 70s reflects the natural evolution as surgeons find more clinical uses for it. As for our orthopedic sales team gaining market share and being proactive, I want to emphasize that even though some of our products aren’t available for our customers, that doesn’t stop our sales representatives from supporting other products that are on the market. They are successfully selling what they can and assisting in clinical cases. However, I should note that once we come off back order, we don’t expect to immediately start regaining market share. We anticipate a transitional period of a quarter or two for customers to recognize our sales team and the opportunity to use CONMED products again.

Our next question comes from the line of Travis Steed of BofA Securities.

This is Gracia on for Travis. My first question, I just wanted to ask a little bit on the capital environment and what you're seeing this quarter in those trends and then how you expect them to sort of progress over the next 12 months here?

Pat here. We're observing a robust capital market without signs of a slowdown. Hospitals are still investing in capital equipment that enhances patient outcomes and increases volume throughput in the operating room, which is our focus area related to surgical procedures. As we look toward next year, I believe that, with interest rates declining, we'll continue to see this trend.

Great. And then maybe just one follow-up on margins. I know you guided more flat for margins in '25 and $20 million of annual savings from the operational improvements. How do you think this supports margin expansion and maybe the next year as well and puts and takes to consider in SG&A and R&D, just thinking looking forward?

Yes. Thanks, Gracia. Did I get that name right?

Yes, that's correct.

Okay. So we're going to talk about '26 in '26. But you're right, we have been making improvements, as Pat said. We have communicated that we expect to save tens of millions of dollars overall. Of course, there's things that work against that, right? The new tariffs, of course, are going to be worked against that. But we will give 2026 guidance when we do our Q4 call.

Our next question comes from the line of Mike Matson of Needham & Company.

This is Joseph on for Mike. Maybe just on orthopedics. I saw that it looks like improved growth in the U.S. and internationally. So I just want to see if you can maybe just give more color on that improvement in the quarter. What are you seeing there? And what were the major drivers in the quarter?

Joseph, good question. Again, I'd call out two things. BioBrace continues to do well. BioBrace is a great growth platform, not just in our Sports Medicine portfolio, but also in our Foot and Ankle portfolio, and it's doing great things for us. That also combined with improving reduction in back order and improving service levels on the operations side are allowing us to take some incremental steps forward in growth. But I would again just call out, we're not declaring victory there on the operations front and continue to expect progress in quarter 4.

Okay. And then I guess just a quick follow-up. Really appreciate all the color you gave on the backlog and the improvement there. But I'm just wondering if there's a way that you can kind of plot this out time line-wise, maybe what inning of the improvement are we in? Yes, that would be helpful.

Well, I hope this isn't a long game like the World Series that went to 18 innings. We are definitely in the latter part of the game. I'm not sure if it's the sixth, seventh, or eighth inning, but we are in the fifth, sixth, or seventh. I don't want to prematurely say we've won. There are still more innings to play. I feel optimistic about our progress and our commitment, and I am pleased with what we have learned. Now it just requires time. We recognize that the supply chain can take a few quarters as vendors start to make headway, and this process doesn't happen instantly, but I feel good about our progress in that area.

I would now like to turn the conference back to Pat Beyer for closing remarks. Sir?

Thank you for joining us for our third quarter earnings call. We're excited about the upcoming fourth quarter and look forward to providing updates on 2026 in January. Thank you.

This concludes today's conference call. Thank you for participating, and you may now disconnect.