Thank you for standing by and welcome to Globus Medical’s Fourth Quarter and Full-Year 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. I will now turn the call over to Senior Vice President of Business Development and Investor Relations, Brian Kearns. Please go ahead.

Thank you, Latif, and thank you, everyone, for being with us today. Joining today’s call from Globus Medical will be Dan Scavilla, President and CEO; and Keith Pfeil, Chief Financial Officer. This review is being made available via webcast, accessible through the Investor Relations section of the Globus Medical website at www.globusmedical.com. Before we begin, let me remind you that some of the statements made during this review are or may be considered forward-looking statements. Our Form 10-K for the 2021 fiscal year, and our subsequent filings with the Securities and Exchange Commission identify certain factors that could cause our actual results to differ materially from those projected in any forward-looking statements made today. Our SEC filings, including the 10-K are available on our website. We do not undertake to update any forward-looking statements as a result of new information or future events or developments. Our discussion today will also include certain financial measures that are not calculated in accordance with Generally Accepted Accounting Principles or GAAP. We believe these non-GAAP financial measures provide additional information pertinent to our business performance. These non-GAAP financial measures should not be considered replacements for and should be read together with the most directly comparable GAAP financial measures. Reconciliations to the most directly comparable GAAP measures are available in the schedules accompanying the press release and on the Investor Relations section of the Globus Medical website. With that, I will now turn the call over to Dan Scavilla, our President and CEO.

Thanks, Brian, and good afternoon, everyone. Globus finished 2022 with a strong fourth quarter. Revenue for the year was a record $1.23 billion, crossing the $1 billion threshold for the first time. We delivered $65 million or 7% as reported and 8% constant currency growth for the full year. This is above last year's difficult post-COVID comp, where we grew 21% for 2021. We achieved record sales while maintaining industry-leading profitability generating a record $2.06 in non-GAAP EPS and an adjusted EBITDA of 33% even as we continue to invest heavily in INR, trauma, competitive recruiting, and absorb significant currency headwinds. We also launched seven new products in 2022, four of the launches occurred in the fourth quarter. Revenue for the quarter was $275 million, up 10% as reported or 12% in constant currency. Non-GAAP EPS was $0.59, up 20% versus prior year Q4. And adjusted EBITDA was 33%. U.S. Spine grew 10% in Q4 with notable gains across our product portfolio in expandables, biologics, MIS screws, 3D printed implants, and cervical and lateral offerings. The gains were driven by competitive rep conversions and robotic pull-through. We had a strong competitive recruiting year surpassing the hiring levels in 2020 and 2021. This is usually a leading indicator of growth in the coming years and we're excited about the potential of the team we've onboarded in 2022. In Q4, we launched our pro lateral patient positioning system as part of our focus on the continuum of care. It is an interactive adjustable bed mount that enables a single position, single stage, lateral surgical approach for direct and indirect decompression. Designed to maximize operational efficiencies, increase ease of implant placement, and minimize surgeon fatigue. It integrates seamlessly with our ExcelsiusGPS and Excelsius3D solutions and enables significant capabilities in non-robotic procedures. When combined with our Excelsius platform and our range of expandable interbody offerings, we have unique and customizable lateral solutions available to our surgeons. Enabling technology sales were $30 million, up 20% on a constant currency basis versus prior year, driven by robotic and imaging system sales. This was our highest quarter since launching Enabling Technology, surpassing last year's Q4 sales that delivered 40% post-COVID growth. We continue to see increased interest in placements with significant international gains of ExcelsiusGPS in EMEA and the U.K. that we feel will lead to future implant pull-through and strong market share gains. Robotic procedures continue to accelerate, growing 25% for the full year, and exceeding 43,000 robotic procedures performed to date. We launched the Excelsius3D imaging system in Q2 of this year and continue to penetrate the market throughout the year. Surgeons have said this is a game changer. Excelsius3D is a three-in-one imaging platform offering three image modalities in a single cart with high maneuverability, a large field of view, and seamless integration with our ExcelsiusGPS robotic system. It is a key component of the Excelsius ecosystem in the operating room. An ecosystem that is designed and built from the ground up to communicate together seamlessly. Market interest remains high for the state-of-the-art technology and customer orders continue to grow. Excelsius3D is positioned to be a major growth driver as we enter 2023. Our international spinal implant business, excluding Japan, delivered record sales in Q4, growing 20% on a constant currency basis compared to the prior year. We delivered double-digit growth in most markets, and continue to see strong growth in key markets ranging between 25% and 50% for the quarter with the U.K. and Australia being major contributors. Our trauma business delivered its 12th consecutive quarter of sequential growth, delivering 70% growth for Q4 and 71% for the full year. Trauma performance is driven by sales force expansion and strong uptake in all 14 product lines, delivering high double-digit growth in each product offering. In Q4, we launched the AUTOBAHN EVO femoral nail systems, the integrated nail is designed to be standalone and the retrograde nails designed for either standalone or plate and nail combo procedures with our Anthem Distal Femur system. Initial surgeon feedback is strong and we expect the next generation of nails to be a key growth driver in 2023. Our product development engine continues to make progress, focusing on procedural solutions, designing implants, instrumentation, and procedures that will focus together within our Globus ecosystem for a seamless and comprehensive approach in spine, trauma, and joints. At the same time, we're expanding our solutions throughout the patient's entire continuum of care, supporting surgeons in preoperative planning, intraoperative execution, and postoperative patient care to capture outcome data for future surgical planning. While this complex approach has extended development timelines beyond our historical rapid pace, I believe the upcoming launches will have greater significance and shape procedures of the future. Moving into 2023, Globus Medical and NuVasive are planning to combine in an all-stock transaction to create a global musculoskeletal company focused on rapid innovation, addressing unmet clinical needs, and improving offerings to our surgeons and patients. The all-stock structure preserves cash to deleverage the company and accelerate investment in assets to fuel growth. The combination capitalizes on our complementary commercial organization, where we see little territory overlap, and should allow us to accelerate our globalization strategies to increase customer reach and strengthen our surgeon relationships. We plan to bring together the best-in-class technologies from our portfolios to create a differentiated and comprehensive procedural solution offering as part of our approach to address unmet clinical needs and support our surgeons and patients. Our product development engines will combine and increase our focus on rapidly developing innovative solutions throughout the continuum of care from preoperative planning through to postoperative monitoring. Our operational footprints are highly complementary, allowing us to better leverage each other's manufacturing and supply chain resources to increase internal production, while reducing the amount of capital investment required as standalone, so we can redirect investment and improve cash flow. Over the past several months, it has become clear to me that both organizations have more in common than they are different. The complementary strengths of Globus engineering with NuVasive's certain relations, education, and training will combine for a truly potent innovation company. We will continue to outpace the market growth where we compete and gain share while maintaining financial discipline to drive sales growth, continue with mid-30s EBITDA, accelerate EPS growth, and increase cash flows for our investors. As an update on the merger status, we are currently preparing our HSR submission and the joint proxy statement. Cross-functional integration planning has ramped up, so we can pivot to integration implementation once the merger is approved when we clear HSR, secure shareholder approvals, and meet closing requirements. We expect to close the deal in mid-2023. In closing, we remain focused on core elements for long-term growth, innovative new product introductions, robot imaging system sales, competitive rep recruiting, and merger integration planning. 2023 is all about focus and execution to deliver value to our customers and drive growth. I know we are well positioned to achieve our mission of becoming the preeminent musculoskeletal company in the world.

Thank you, Dan, and thank you to everyone for joining us on today's call. Globus achieved a milestone in 2022, growing to over $1 billion in sales, despite strong currency headwinds and lingering COVID impacts earlier in the year. Full-year 2022 revenue was $1.023 billion, growing 6.8% as reported and 8.2% on a constant currency basis with the same number of selling days in 2022 and 2021. Currency impacts were unfavorable to revenue by $14 million in 2022. Net income was $190.2 million, resulting in fully diluted earnings per share of $1.85. Non-GAAP net income was $211.6 million, generating $2.06 of fully diluted non-GAAP earnings per share. 2022 adjusted EBITDA was 33.2%, and we generated $104.4 million of free cash flow for the full year. Q4 2022 revenue was $274.5 million, growing 9.8% as reported and 11.7% on a constant currency basis. Net income was $50.1 million, and non-GAAP net income was $60.1 million. Q4 2022 fully diluted earnings per share was $0.49, while our fully diluted non-GAAP earnings per share was $0.59. Adjusted EBITDA was 32.8%, and we generated $45.6 million of free cash flow for the quarter. U.S. revenue in the fourth quarter of 2022 was $233.2 million, growing 9.5% as reported compared to the prior year quarter, led by growth in U.S. spine, biologics, and trauma. International revenue for the fourth quarter was $41.3 million, growing 11.4% as reported and 24.2% on a constant currency basis, driven by increased INR and implant sales. Gross profit in the fourth quarter was 74.3% versus 75.3% in the prior year quarter and is consistent with expectations. The 100-basis point decline was driven primarily by product mix and higher freight costs, partially offset by lower inventory reserves and depreciation expenses. Full-year 2022 gross profit was 74.2% compared to 75% in 2021. The 80-basis point decrease was driven by product mix, primarily higher capital sales and higher freight expenses. Research and development expenses in Q4 were $19.5 million or 7.1% of sales, compared to $51 million or 20.4% of sales in the prior year quarter. The lower spending is driven by decreased IP R&D spending in Q4 '22 versus Q4 '21. On a normalized basis, Q4 '21 R&D spending was $16.7 million or 6.7% of sales. The resulting quarter-over-quarter increase is driven primarily by higher continued investments in R&D, mainly driven by increased headcount across our spine, INR, and trauma portfolios. Our full-year 2022 research and development expenses were $73 million or 7.1% of sales, compared to $97.3 million or 10.2% of sales in the prior year. Adjusting for acquisitions made in both periods, R&D expenses in 2022 were $72.9 million or 7.1% of sales, compared to $63 million or 6.6% of sales in the prior year. The increased spending is consistent with my comments on Q4 2022, namely headcount investments across our portfolio. SG&A expenses in the fourth quarter were $118.1 million or 43% of sales, compared to $106.6 million or 42.6% of sales in the prior year quarter. The increase is primarily higher selling costs as a result of higher compensation costs from competitive recruiting, as well as higher travel expenses. Full-year SG&A expenses were $432.1 million or 42.2% of sales, compared to $408.1 million or 42.6% of sales. The increased dollar spending is primarily driven by volume impacts from higher sales growth, as well as higher sales compensation expenses and higher travel. SG&A spending decreased 40 basis points versus 2021, driven by leverage on fixed spending, partially offset by higher sales costs and training expenses. The income tax rate for the quarter was 19.4%, compared to 23.8% in Q4 of 2021, driven primarily by lower international tax expenses. Our full-year 2022 income tax rate was 21.7%, compared to 17.3% in the prior year, with the resulting increase driven by lower benefits associated with stock option exercises. Fourth quarter net income was $50.1 million, and non-GAAP net income was $60.1 million. Q4 diluted earnings per share was $0.49, and non-GAAP diluted earnings per share was $0.59, compared to $0.49 in the prior year quarter. The $0.10 increase in Q4 2022 non-GAAP EPS includes a net $0.04 of non-operating favorability driven by a lower tax rate and higher interest income, partially offset by currency translation impacts. On a normalized basis, non-GAAP EPS in the fourth quarter was $0.55, compared to $0.49 in the prior year quarter, growing 12.2%, driven primarily by sales volume growth, as mentioned earlier. Full-year 2022 diluted earnings per share was $1.85 and non-GAAP diluted earnings per share was $2.06, compared to $2.04 of non-GAAP EPS in 2021. Our full-year 2022 non-GAAP EPS is inclusive of $0.14 of non-operating items, which includes unfavorable currency impacts worth $0.11, a higher tax rate worth $0.10, partially offset by higher interest and other income worth $0.05 and a lower share count worth $0.02. Full-year 2022 adjusted EBITDA of 33.2% includes 90 basis points of unfavorable currency impacts, resulting in a normalized 34.1% adjusted EBITDA for the year. Net cash provided by operating activities was $64 million in the fourth quarter of 2022 and $178.5 million for the full year. Free cash flow was $45.6 million in the fourth quarter and $104.4 million for the full year 2022. Our 2022 free cash flow was impacted by higher capital expenditures, as well as investments in working capital, namely inventory and accounts receivable. The company remains debt-free. At this time, the company is establishing its full-year stand-alone 2023 guidance. We are projecting full year 2023 sales guidance of $1.1 billion, representing 7.5% growth versus 2022. We are guiding to a full-year fully diluted non-GAAP earnings per share of $2.30, representing 11.7% growth versus 2022. Our 2022 results are reflective of continued investment across our business. R&D spending increased as we seek to bring more new and guiding products to market. Our sales and marketing spending increased as we continue to grow our sales force, and our CapEx spending increased to meet increased demands for product output and set deployment. In closing, I'll briefly add a few comments in addition to Dan's earlier comments as it relates to our February 9 announcement that we've entered into a definitive agreement to combine in an all-stock transaction with NuVasive. Once shareholder and regulatory approvals are obtained and the transaction closes, we expect to deliver 20-plus percent non-GAAP EPS accretion by the completion of the first full year. This assumes likely near-term sales dissynergies from rep and account disruptions, partially offset by revenue synergies around complementary implant sales and additional INR sales of Globus Capital and NuVasive accounts. In addition, this includes delivering on $170 million of cost synergies, of which we expect to achieve 50% by the end of year 1, 75% by the end of year 2, and 100% by the end of the third year.

We will now open the call for questions.

Great, thank you so much and congratulations on exceeding $1 billion in sales. So I guess my first question is, we've all had some time to digest the deal, but just given the stock reaction, I'm wondering if you could comment on where you see the disconnect in your thinking versus investors on deal rationale, financials, and/or strategy? And one of the other things that has come up is, if you may, sweeten the deal; could you just talk about the flexibility and willingness to close the deal here? Any comments would be helpful. Thank you so much.

Thanks, Shagun. So just keep in mind as we did this, and as we've talked about during our announcement, you're really looking at what we believe is a complementary global scale, the ability to expand customer reach with minimal overlap. We've talked about being able to develop a comprehensive and innovative portfolio in spine and orthopedics when we combine these companies. We remain committed to innovative product development and surgeon education. We're saying that the operational capabilities fit nicely together in this and actually can benefit us as a combined entity. When you look at that and combine us, I think the compelling upside of revenue that even Keith mentioned with the EPS and accretion is out there for value opportunity—that's what we see. The disconnect, I can't say; I can't speak for Wall Street. They'll point to several unrelated deals and look at that, but that's okay. It's certainly their prerogative to do it. As for what we would do in a market change in stock, that's something we wouldn't be in a position to actually comment on, and it’s something we'll have to evaluate as we approach it.

Got it. And just as a follow-up question. Can you just talk about the relative contribution from rep recruitment versus NPIs versus pull-through from Enabling Tech to U.S. implant sales? And then are you parsing out final implant and imaging sales for Q4? And thank you for taking the questions.

Thanks, Shagun. To be honest with you, I wouldn't have the ability to pull all those things apart and really tell you what they were. Again, since we're running the business as a whole. I think the fact that we've significantly outpaced the market with continued growth is probably more important than the sum of the parts.

Great. Hi, thanks for taking the question. So I wanted to see if you could address more specifically, I think the main concern a lot of investors have is about the dissynergies, the turnover that you talked about. Can you talk a little bit about how you can mitigate that? And then also how you may be able to offset that with some of the revenue synergies that you discussed here and maybe the timing of this?

Thanks, Matt. So we won't go into too much detail on this now. What we're signaling is, of course, in any deal, we would expect to have a reasonable amount of dissynergies, and we've built that in. Whether that be reps going to a competitor, account switching, or just natural things that would occur. What Keith said and what I would stand by is, however, when we're able to get our hands on a cervical disc that's multilevel that they have, their lateral procedures, we can hand them our expandables. We can open up a market for our enabling technology. All those things will actually offset sales dissynergies, and we believe we will see that over a couple of years. We strongly believe in this; so by combining the portfolios and the markets, we will come out stronger. We may see some short-term pain, but we're building a strong company for the long-term.

Maybe I could just ask one follow-up on the synergies. You seem very confident in that target that you laid out. Maybe just talk about how much of that stuff you would call well identified or lower hanging fruit? And how much of it is harder to pull apart and synergize in your plan?

Thanks for the question. Yes, we do feel good about achieving the $170 million in synergies. I would say that we're in the early stages of working with the teams to better understand the business. But as we look at our cost structure versus their cost structure, we feel confident that we're able to achieve these savings when you look at the combined spending of both companies together.

Hey, it's Matt Miksic. I wasn't quite referring to me; after I look at the less name, but if you can hear me—can you hear me okay?

Yes, we got you, Matt.

Yes, a lot of Matt on these calls. So one just follow-up, if I could, on the synergies on Matt Taylor's comment, and then I have one on margins, if I could. So on the synergies, can you talk about maybe what is not included in those? I mean, there's a fair amount of complementary products, robots and cervical disc replacement and the cervical portfolio at GMED that are potentially complementary in the sense of driving additional sales. Are those included if they are, I guess, what things have you and have you not included in that number? And then I have one follow-up.

Yes. Matt, for clarity, I believe you're talking about sales synergies and dis-synergies. Is that right?

Yes, correct.

Okay. Again, we're not going to go into a lot of granular detail on this. I think we're just signaling to look at what NuVasive has as a strength where we can benefit, and we're saying it’s the opposite way for us, too. It's really that combination. We have some placeholders and some ideas that we're working through, but this is early stages, as we just announced the deal.

Got it. Okay, that's helpful. And then on margins going forward, obviously, you're looking for some EBITDA margin leverage this year. Can you talk about maybe some of the headwinds that you're facing to sort of keep you here in kind of the low end of the mid-30s range as far as we can tell us kind of where your $2.30 EPS number kind of puts you for this coming year based on the top line, and how those kind of play out throughout the year, that would be helpful. Thanks.

Sure. Thanks for the question. So as you think about going into next year on a standalone basis, the EBITDA margin does come out on the lower end of the range. But when you think about some of the things we've done recently, we've really stepped up our investment in R&D spending; that's jumped out. We've invested a little bit more in our sales force. That should show fruits as we move forward. But I talked a little bit about product mix in the quarter and the full year. Capital sales have a little bit of a headwind on overall profitability. But stepping back to that, we still feel that we're a mid-70s business. I mean if you look at this year, specifically 2022, the currency impact of $14 million was worth about 90 basis points to EBITDA. So when I look at that, I see that we're healthy and driving the business forward. Places that we see inflation, I’ve talked about freight this year. I think in each quarter, we've seen freight tick up just from fuel prices across the rest of the P&L. It's fair to assume that you're seeing some inflation in travel. Last year in 2021, the travel grew sequentially as COVID starts to dissipate. But I think last year in Q4 and this year you saw inflation take hold. It’s absolutely some of the drivers that you're seeing in the increases there, which offset some of the leverage growth – or leverage benefit you might have seen in SG&A.

Thanks, so much.

Thank you.

Hey, good afternoon and thanks for taking the questions. So two for me. First, related to the deal, I know you've said there's limited customer overlap, but can you talk about where some of the product overlap is and which assets or categories you think you may have to divest? My second question is one of the large orthopedic competitors has talked about coming out with a spine robot application in 2024. Can you perhaps talk about the market and competitive landscape and whether you expect any impact in 2023 to your ability to continue to sell Excelsius systems?

Thanks, Vik. So I would just get through the second part of the question. We've always expected— we’ve been one of the first to move on this, and the market will grow over time and become naturally competitive. You asked the question, what do you do to stay relevant? We've been talking continuously about our development of the ecosystem of multiple things that all fit together. We’ve been pushing out, driving. That will not only keep us relevant but also keep us as a leader here. Listen, competition will come naturally. They're coming because we've had success, and we're going to continue to invest and innovate. We've talked continuously about our investment in R&D and how that's a pull down because we’re investing properly to build strength for long-term gains. Now, regarding the first part of your question, I would tell you that given our size, we're not anticipating any significant divestitures at this time. We're in the middle of all these filings, and right now, we don’t have concerns triggering anything significant.

Hi, guys. This is Joseph on for David. Maybe just looking towards the upcoming new robot launch. Could you maybe talk about some of the strategy behind that? What are the initial accounts you're going to be targeting? You did talk about the expansion of the sales force, but maybe could you also talk about pricing and feature set relative to currently available robots? And then, if possible, could you quantify those commercial investments associated with the launch?

Thanks, Joseph. I wish I could, but we don't have all of that data just yet. So let me break your question into those chunks and go at them. I think accounts, certainly, we would have our eyes on ASCs and certainly hospitals. I wouldn't say we're going to specialize in one or the other; we’ll look to go at both with that type of approach. You are correct that our initial thought was capital reps, and these obviously require us to take steps in investments things that we've built into our projections. But again, if you know us, we don't go out and have a big bang. We use concentric circles where we hire a group, stabilize and get it going. We’ll pay for them and go on and on just as we've done in the past. I wouldn’t signal that there's a major drop or anticipated investment that takes us off our curve that way. And finally, with pricing, I would just tell you, we’ll price at the market appropriately. We recognize there's competition out there. We feel like we've got a viable solution that will add value to doctors, and depending on what the market bears, we're in a position to make that happen. Yes. I would tell you that it’s in the stabilization phase; it's probably about a quarter behind where I would have wanted it to be. But what we're seeing right now is that is settling down to where I think it’s actually at the point where we should expect to see some building up of it in the first half of this year.

Thank you. Good evening, guys. Looking at the 2023 sales guidance, wondering if you can provide any color on components of growth, U.S. versus U.S. Spine, Emerging Tech, incremental Trauma. Any color there?

Great question. Thanks for it. We typically don't break out the parts and pieces. But when I step back and look at the year that we're going into, I still feel very bullish about our U.S. Spine business and its ability to grow. I think we came off a strong quarter between Biologics and Trauma in the U.S., Enabling Tech. I see that continuing to grow, cognizant that we're entering into a recession. However, one of the things that we see happening is greater sales of those units internationally. So that's something that we feel good about going into next year. But that's as much detail as I can give in terms of bringing out the guidance.

Steve, one thing I’d add to that, which I’m pleased with, is we’re not dependent upon one or two of these. It seems like we’re projecting forward as we've performed in the past. While we'll never get each one of these exactly right, we have enough levers here that I feel strongly that we can get into this and achieve it. It's a great question. And look, it’s human nature in the state of change to have some discomfort. The best thing to do is communicate because we don’t need to beg here with this. Keep in mind that we, as Globus, and what we intend to do as the bigger company is to pay strongly for our reps, and we’ve been doing that historically without change, unlike other companies. We’re going to maintain that. At the same time, we have discussed in person with the field team our portfolio to understand the strengths that we’re about to give them on the NuVasive side, and they've actually are in the process of doing the same for us on the Globus side with that. So we’re talking about strong compensation, arguably the strongest offering for products in the spine market. Our Enabling Technology, along with the Pulse system, can really become a powerful tool, and I think everybody can see that. We’re always looking at what near-term, yet future innovation can be to significantly tie these together through that ecosystem. When we offer that up with people, it’s a tough thing to compete against, and a rep that is long-term focused and wise can recognize that within 12 months, they're going to have at their fingertips the most powerful offering in the industry.

Hey, I kind of broke up, you say Matthew O'Brien?

He did.

Okay, fantastic. Thanks for taking my questions. So I guess, Dan, can you or Keith actually just talk about the timing of the NuVasive vote from the shareholders? And then it is a take under at this point. It's about 5% lower stock price versus where it was traded before the announcement. So how are you going to talk those investors into voting for this transaction between you and Chris? And are you so committed to this deal that you would offer up a sweetener, be it more stock or even cash, if need be, to make sure this gets done? And I do have one more follow-up.

Thanks, Matt. So a lot of questions there. I would tell you that we're not going to be in a position yet to comment on what it is we're going to do. Certainly, we're going to talk to investors to show them why this deal makes sense, show them the math to get them lined up with this and understand that this is a long-term gain that will create a significant acceleration versus if we stay as standalone. I think it's probably the biggest thing with it. But to talk about any other steps at this point would be premature, so I'll refrain from that.

Okay. But Dan, the—when we hear mid-year closing, you think, all right, June 30, so the vote would be sometime before then. I mean, is the next few months where we could see the vote?

Sorry, I did leave that off. I wasn't avoiding that. Really what we need to do right now is create the joint proxy first and then get the vote. We're in the process of compiling that, as I said in my statements. Look, I don't have an exact date where we'll say that's done, but it's obviously the priority right now is to get the HSR filing in, get that going, and get the joint proxy to motion.

Okay. And then the follow-up, Dan, is again more of a strategic question because I think part of the reaction in the stock was the adjustment to the strategic direction of the business that I think most were anticipating. Now you are kind of more diversifying away from spine; now you are doubling down more. Is this part of a bigger push for the company longer term, to double down on spine, get big there, get a lot of cash flow, then invest in other areas of Ortho to become a much bigger entity in this space? Thanks.

Thanks, Matt. Again, a really good question. So it's always obviously interesting from the seat for years. For eight years, investors have asked what are you going to do? How are you going to make an acquisition? What are you going to do? We've made an acquisition and folks are sort of stepping back by it. But the fact is we've been patient; we've looked; we've analyzed; we decided this is the right time to do it. We've looked through multiple scenarios throughout our portfolio and really came back to this being the strongest opportunity now to go do this. What you touched on is exactly right: the combined company will be stronger than the individuals, and our cash flow, when we combine, will be significant, which will allow us then to move on to other larger acquisitions over time. This doesn’t mean that we've just shifted and won't create innovation and launch organically. We're just saying we want to use the financial strength to our benefit as well as our engineering prowess.

Thanks, guys. Thanks for taking the questions. I wanted to focus on Enabling Tech here. It did come in a little bit lower than the Street was expecting. I know you guys had a record quarter. You guys have talked about the strength internationally. Maybe I wanted to parse out U.S. versus OUS trends with Enabling Tech. And then you really see kind of what you see in your funnel? And has anything changed over the last three months or so since the last quarter with the funnel, either U.S. or OUS?

Thanks, Craig. I will use my first— I'm not sure I would apologize for delivering 20% growth in a recession and a challenging market. I think that's a very strong performance that was done by the team, and so I'll stand by that one. Last year 2021, you had a lot of sales robotically in the U.S. because of pent-up demand and a lot of activity along with COVID. While I say we came close to that this year, the international has, I think, recovered economically a little bit better than the U.S. in some of these concerns. What we're signaling is we've seen some great placements internationally that kind of put us back into a strong overall robotically. As we've also put out the imaging system, we’re right now working within the U.S. for where that is, and what we're doing.

And the only comment I would add to Dan, to what Dan stated: if you step back and look at the Enabling Tech, going back to 2018, that business delivered $47 million in sales in '18. It delivered $47 million in '19. We went through COVID, and we delivered $41 million. Last year, we delivered $81 million to finish this year at $96 million. So the business has really grown. Obviously, there are always issues that we're going to be faced with. But at the end of the day, we're really going to work through them and get our capital in the hands of our customers.

Sorry, I didn't hear my name there. Thank you for taking the questions. I want to talk a little bit about top line guidance. You outlined some expectations for the usual sales dis-synergies once the deal closes. I'm just wondering how you're thinking about the first half of the year pre-deal close. Any sort of people taking the eye off the ball, maybe guidance contemplate some of that on a stand-alone basis? And then there's potential upside there if that doesn't play out. Any insights you can provide there would be helpful. And then secondarily, on new products, you're still talking about the total joint application from a robotics perspective. But in the past, you've detailed maybe some product gaps or need to improve the underlying implant systems in total joints. Is it fair to expect that we should see some of those new product launches come along ahead of the robotics launch?

Right. Thanks for the question. I'll take the first part and hand the second part over to Dan. So as it relates to guidance, stand-alone guidance and looking at 2023, I don't see or we don't see anybody taking their eye off the ball. We're happy with what we've seen thus far in the quarter. Sales are meeting expectations. So I don't see anyone taking their eye off the ball. We are running a business, and we're moving the business forward as we intended prior to the deal announcement.

What I would say on your second question is we will launch out our robot that will have a knee application. We're working on other applications now. I would not think that you're going to see them come out before the knee application would be my initial thoughts. So I think we'll start out with the real migratory and hip as we said, and then we have the ability to move into other applications over time that way.

Hi, it’s Matt Blackman from Stifel. Thank you for taking my question. Just one, just thinking about the inputs you put into your deal model revenue dissynergies, synergies; do you think there's the most flex or maybe better said, where is the most opportunity and perhaps the most risk as you think about those different inputs?

Yes, it's a great question, a little bit of a teasing question. We probably don't want to answer. But what I would tell you is I feel like we were aggressive in what we think the dissynergies would be and light in what we think the synergies will be. We're a conservative group by nature, if you know us, and so I do think that we might be able to retain better than we've planned in dissynergies. I think we could probably beat if we have the right focus on our synergies within those sales areas, but not product-specific, just in general.

Hi, thanks for taking the questions. Two for me. Just on the deal, you mentioned minimal customer overlap. I was hoping you could elaborate on what the threshold was for defining minimal overlap per surgeon between the two companies. I'm essentially just trying to gauge whether a surgeon that you consider not to be overlapped will that necessarily translate into minimal disruption in the region, especially in the way that territories are going to be grown because you still need to split those territories. So I was just hoping you could maybe elaborate a little bit on that.

Yeah, Rich, I'll do that in a certain way. There's not a lot I can reveal right now, but I will give you what I think we can do along these lines. During the diligence, of course, all of this data was blinded and it was done by bankers, not us. We traced it down to a surgeon level as the most logical way to go. What we found is—we had the vast majority as complementary. The definition of complementary is that someone may either have 100%, 80%, 75% of a surgeon by themselves. If you're 50-50 or less, that would be the overlap. What we found is extremely high in the 90s of the ability to match up. Now, as we unblind that, perhaps we see it differently. Even with a surgeon overlap, it’s possible that the surgeon is using NuVasive's pedicle screws in our interbody or vice versa. So it may not be a product conflict. The thought being that even along those lines where that is the case, we can decide between those reps what's best. Do one keep the surgeon? Do they both keep it? Our goal is to maintain all the reps. We have enough space, enough growth, enough opportunity to do this. It’s not really about a rep rationalization. What we're signaling out is a very favorable deal that will minimize disruption. I’m speaking to you through it right now, Rich. No kidding. No, listen, it's on track. I think that, again, you can never say for sure what's going on with the FDA in the filings. But I would tell you that we signaled that with the thought that it would be out towards the latter part of this year. By no means will we take our eye off that ball. It's going to be a great player for us to get out and continue to differentiate with this type of approach. So it's one of the top priorities.

Hi, thanks for taking the question. Just one on international. I think in your prepared comments, you said international ex-Japan was up 20% year-over-year. Can you maybe give us a little bit more detail about the all-in number with Japan? And then just comment on any kind of key moving drivers there in the international market. It seemed like from the acquisition call you were putting a lot of emphasis on the global reach of the two companies. So any more detail that you could share there would be great.

Thanks for the question. So as we look at international, the Japan sales were down. There’s obviously some currency impacts in there as well. But what we really saw as we got to the back end of the quarter is touches on the stabilization that Dan commented on earlier. As we get into 2023, we expect to start to see this business move forward and grow.

With no further questions, this concludes the Globus Medical Fourth Quarter and Full-Year 2022 Analyst Call. Thank you for your participation. You may now disconnect.