Ladies and gentlemen, thank you for standing by and welcome to the third quarter 2026 Humanetics Corporation Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you would need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would like now to turn the conference over to Olga Guyak, Vice President, Investor Relations and Treasury. Please go ahead.

Good morning, and thank you for joining us for Humanetics' third quarter fiscal year 2026 conference call and webcast. I'm joined today by Chris Simon, our CEO, and James Derecka, our CFO. This morning, we released our third quarter and year-to-date Fiscal 2026 results and updated full year Fiscal 2026 guidance. The materials, including our earnings release, Form 10-Q, and the supplemental earnings presentation are available on our Investor Relations website and in this morning's press release. Before we begin, I'd like to remind everyone that we will use both reported and organic revenue growth rates that exclude the impact of effects, the divestiture of the whole blood product line, and the exit of certain liquid solution products. Organic Growth Act CSL also excludes the impact of the previously disclosed transition of CSL's U.S. disposable business. We'll also refer to other non-GAAP financial measures to help investors understand humanetics' ongoing business performance. Please note that these measures exclude certain charges and income items. A full list of excluded items, reconciliations to our gap results, and comparisons with the prior year periods are provided in our earnings release. Our remarks today include forward-looking statements, and our actual results may differ materially from the anticipated results. Factors that might cause our results to differ include those referenced in the SAFE hardware statement in today's release and in our other SSE filings. We do not undertake any obligation to update these forward-looking statements. And now, I'd like to turn it over to Chris.

Thanks, Olga. Good morning, and thank you for joining us today. We delivered a strong quarter, and we are raising our full-year revenue, earnings, and free cash flow guidance. Nexus and TAG delivered outsized growth driven by sustained share gains, innovation-based pricing, and durable end-market demand, demonstrating the strength and resilience of these core products in our increasingly productive operating model. Third quarter revenue was $339 million, bringing year-to-date revenue to $988 million. Reported revenue reflects the $153 million impact of last year's portfolio transitions, allowing for these non-recurring items, underlying performance remains strong, with organic growth ex-CSL of 8% in the quarter and 10% year-to-date. Adjusted earnings per share increased 10% in the quarter and 11% year-to-date to $1.31 and $3.67 per share, respectively, underscoring both the quality and the durability of our earnings. With that context, let's review our businesses in more detail. Hospital revenue was $144 million in the third quarter and $429 million year-to-date, down 1% in the quarter and up 2% year-to-date organically, as strong performance in blood management technologies offset softness in interventional technologies. Blood management technologies delivered solid growth, up 8% in the quarter and 11% year-to-date, driven by sustained double-digit growth in hemostasis management. Momentum was fueled by TEG-6S disposable sales and rapid adoption of a global heparinase neutralization cartridge, which continues to accelerate account conversions and penetration. We have significant runway to upgrade legacy TEG 5000 systems, increase TEG 6S device sales and utilization, and expand share within current indications. The launch of the HN cartridge in EMEA and Japan further strengthens our global leadership and adds international growth vectors to the $400 million plus serviceable market. Growth elsewhere in BMT was modest, with transfusion management gains largely offset by a decline in cell salvage, driven by a tough comp following last year's customer migration to higher-margin technology offerings. Interventional technology revenue declined 12% in the quarter and 8% year-to-date, driven primarily by softness and esophageal cooling amid accelerating PFA adoption and OEM-related headwinds in sensor-guided technologies, which together accounted for most of the year-over-year quarterly decline. Vascular closure revenue declined 4% in the quarter, reflecting a 3% decline in MVP and MVP XL in electrophysiology, and softness in Vascade in lower-growth coronary and peripheral procedures. Performance in electrophysiology was influenced by prior share loss, order timing in several of our largest accounts in December, and ongoing shifts in the procedural dynamics that temporarily impact the growth of our addressable market. Our confidence in IVT franchise is unchanged. We believe in the clinical and the economic differentiation of our product portfolio, and we are enthusiastic about the anticipated MVP XL label expansion and the U.S. launch of PerkySeal Elite. The vascular closure sales force is asserting itself and taking targeted actions to strengthen execution. These commercial initiatives are gaining traction, and we expect interventional technologies will return to growth in FY27. Accordingly, we now expect the hospital business to deliver reported and organic growth of approximately 4% at the low end of our prior 4% to 7% range. Moving to plasma and blood center, plasma performance continues to accelerate with another quarter of growth driven by our category leadership and superior innovation. Notably, the franchise has returned to growth with revenue of $139 million, up 3% on a reported basis, despite the last remnants of customer transition headwinds. Organic growth, excluding CSL, was 20% in the quarter and 22% year-to-date, with approximately half of quarterly growth driven by share gains and the remainder from collection volume and the full annualization of innovation benefits. Plasma fundamentals remain attractive, underpinned by durable immunoglobulin demand across a broad spectrum of indications. That strength is evident in the market as U.S. plasma collections grew in the low double digits in the third quarter. With approximately 50% global market share and a differentiated, integrated platform, we operate from a position of strength and expect upcoming innovation in FY27 to further advance our competitive advantage. Given year-to-date performance, we are raising our full year reported revenue guidance to a decline of 2 to 4 percent from a decline of 4 to 7 percent previously, and organic revenue guidance, ex-CSL, to growth of 17 to 19 percent from 14 to 17 percent previously. Blood center revenue was $57 million in the quarter and $165 million year-to-date, growing 3% in the quarter and 4% year-to-date organically, driven primarily by international plasma demand and market leadership, partially offset by order timing and continued portfolio rationalization. We are raising full-year blood center reported revenue guidance to a decline of 16% to 18% from 17% to 19%, inclusive of the whole blood divestiture, and increasing organic growth to 1% to 3% from flat, as international plasma demand is expected to more than offset ongoing portfolio rationalization. Sustained strength across plasma, blood center, and blood management technologies has improved our total company outlook. Accordingly, we are increasing our full-year reported revenue guidance to a decline of 1 to 3 percent from 1 to 4 percent previously, reflecting the impact of last year's portfolio transitions, the majority of which are now behind us and fully reflected in our year-to-date results. This translates to raising our organic revenue guidance, XCSL, by 50 basis points at the midpoint to a range of 8 to 10 percent, up from 7 to 10 percent previously. Over to you, James.

Thank you, Chris, and good morning, everyone. We delivered another quarter of strong financial performance marked by sustained margin expansion and improving cash flow. While we continue to take steps to recapture growth momentum in interventional technologies, our results highlight the benefits of our portfolio transformation, structural improvements supporting profitability, and the multiple performance levers supporting continued progress toward our long-range plan objectives. Adjusted gross margin was 60.2% in the third quarter and 60.5% year-to-date, representing increases of 250 and 390 basis points, respectively. Similar to the prior quarters, margin expansion was driven by the adoption of Nexus with Persona Technology, divestiture of the whole blood business and blood center, and our expanding share in both plasma and blood management technologies. These same drivers are expected to support similar gross margins for the remainder of the year. Adjusted operating expenses in the third quarter were $115 million, up $3 million or 3%, primarily reflecting adjustments in performance-based compensation due to continued outperformance across the consolidated results. We have also remained deliberate in prioritizing targeted investments in R&D and innovation to support long-term growth. Year-to-date, adjusted operating expenses were $343 million, modestly above $339 million last year, largely due to the same factors impacting the third quarter. Adjusted operating income was flat versus the prior year in the third quarter at $89 million, and adjusted operating margin expanded 60 basis points year-over-year to 26.3%. In the third quarter, operating margin expansion was driven primarily by the improved margin profile of our plasma and blood center businesses, supported by share gains on Nexus PCS with Persona and the divestiture of the whole-blood business. This was partially offset by modest margin pressure in hospital, reflecting continued softness in interventional technologies and the resulting impact on operating leverage. On a year-to-date basis, all segments contributed to adjusted operating margin expansion, despite some volatility in the quarterly segment performance. For the total company, adjusted operating income increased 4% year-to-date to $254 million, with adjusted operating margin expanding 200 basis points to 25.7%. Based on performance to date and continued margin tailwinds across the portfolio, we continue to expect approximately 26 to 27 percent in adjusted operating margin for the full year. Updated guidance also includes modest near-term dilution from the VivaSure acquisition as we invest ahead of a planned commercial launch in fiscal 27. The adjusted tax rate was 24.9% for the quarter and 24.8% year-to-date. We anticipate a slight step-up in the adjusted income tax rate in the fourth quarter and expect to finish the year with an adjusted tax rate of approximately 25%. Adjusted net income increased 2% to $61 million in the third quarter and 3% year-to-date to $175 million. Adjusted EPS rose 10% to $1.31 in the quarter and 11% year-to-date to $3.67, which included benefits from recent share buybacks and FX. In the fourth quarter, we expect interest and tax to be a headwind, reflecting a lower tax rate in the prior year and incremental interest expense related to the repayment of $300 million of zero-coupon convertible notes. We now expect our adjusted EPS for fiscal 26 to be in the range of $4.90 to $5 a share, which reflects our strong performance to date, coupled with the acquisition of VivaShore. Turning to cash flow and the balance sheet, cash generation has reemerged as a defining strength of Haymanetics and a core source of strategic flexibility. With our major device build-out complete and a series of company-wide productivity initiatives now largely behind us, the business has returned to the robust cash flow profile that has historically been known In the third quarter, we generated $74 million of free cash flow, bringing year-to-date free cash flow to $165 million, driven by $94 million of operating cash flow in the quarter and $222 million year-to-date. This represents more than a three-fold increase versus the prior year period, reflecting both the normalization of capital intensity and continued discipline in working capital management. Free cash flow conversion reached 121% of adjusted net income in the third quarter and 95% near-to-date, reinforcing our ability to convert earnings into cash. As a result, we are raising our fiscal year 26 free cash flow guidance to $200 to $220 million, from $170 million to $210 million previously, and now expect full year free cash flow conversion to exceed 80%, positioning us with significant flexibility to deploy capital in a balanced fashion. Cash on hand at the end of the third quarter was up 18% to $363 million since the start of this fiscal year, despite deploying $75 million towards share repurchases earlier in the year and making additional strategic investments. Subsequent to quarter end, we also invested $61 million to acquire VivaShore, further strengthening our interventional technologies portfolio, and repurchased approximately 360,000 shares of Haymanetix stock for $25 million. Our capital structure remained unchanged at the end of the third quarter, with total debt of approximately $1.2 billion and no borrowings under our $750 million revolving credit facility, with a net leverage ratio, as defined in our credit agreement, at 2.37 times EBITDA. Back to you, Chris, for closing comments.

Thanks, James. Before we open the line for questions, I want to share a few summary thoughts. We are executing with discipline, delivering solid revenue performance, expanding margins, growing earnings, and generating strong cash flow while advancing our strategic priorities and transforming our operating model. Year-to-date, our results are anchored by strong execution across two of our three growth engines, plasma and our hospital-based blood management technologies. These businesses are delivering consistent sales growth, continued share gains, and increasing profitability. That strength provides both stability and flexibility as we take targeted actions to strengthen the interventional technologies franchise. We remain firmly committed to returning this franchise to sustainable growth in fiscal 2027. The actions required to restore growth momentum are fully funded and largely within our control. As comparisons improve and our commercial organization rallies, the targeted actions underway will translate into stronger results, supported by the anticipated MVP XL label expansion and the U.S. launch of Perky Seal Elite. We expect this business to drive growth and operating leverage while strengthening its competitive advantage. Looking beyond revenue, our portfolio transformation continues to deliver meaningful results across the P&L. Since the start of this transformation, nearly four years ago now, we have expanded adjusted operating margins by 770 basis points, including 200 basis points year-to-date, enabling earnings growth despite the non-recurring plasma and divested blood center revenue. This earnings leverage reflects a structurally improved business model, and it is both durable and scalable, positioning us to continue generating earnings growth ahead of revenue well into the future. Lastly, our strong and consistent free cash flow conversion supports a resilient balance sheet and long-term value creation. Our capital allocation priorities remain unchanged, investing in organic growth, meeting upcoming debt obligations, and opportunistically returning cash to shareholders while preserving balance sheet flexibility. Thank you. Operator, please open the line for questions.

Question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. And our first question is going to come from Rohin Patel with J.P. Morgan. Your line is open.

Hi, thanks for taking the question. Good morning, everyone. I just wanted to start off with Plasma. And you had a nice quarter here. And maybe if you could just help parse out kind of the delta between collections, recovery, and what the market growth looked like underlying as well as your share gains. And looking forward, I guess, I think as we turn our attention to fiscal year 27, obviously you've had a big benefit from share gains this year. So how are you thinking about that next year and kind of coupled with the collections growth? What can we expect to see on a more sustainable basis for Plasma looking forward? And then I have a follow-up.

Good morning, Rowan. It's Chris. Thanks for the question. Yeah, Plasma, and I don't mean to sound boastful on this, but I don't think we've ever been in a better position on the Plasma business than we are today. We talk about the trifecta, which is a combination of share gains. And to your question specifically, for third quarter and most of this year, share gains have carried us, and that comes in two flavors. It's both us picking up share from our direct competitor, But it's also our customers enabled with the best technology, gaining share from their competitors. And I think the dual benefit there is fully half of the growth you see here from us in the quarter. We still have, and this will really be the final quarter, of annualizing the price benefits associated with rolling out that new technology. And then the third piece is collection volume. And what we saw on collection volume in the quarter is a further uptick above seasonality of demand there. We're now growing double digits both in the U.S. and internationally in terms of collection volume. So the trifecta, if you will, of price, share, and volume. As we turn to FY27, this is a point in time. I just remind our listeners, this is our third quarter earnings call. We've got, you know, we'll talk more in May when we issue guidance for the broader business for FY27. This is a point in time where we have detailed sit-down discussions with our customers and get a clear picture for their demand. What I can tell you, you know, at the early stages of those discussions, they're enthusiastic about the environment. both their end market demand, as well as the collections environment here in the U.S. and internationally where they continue to outpace. So we're confident in Plasma's ability to play its role as part of our overall growth engine going forward.

Thanks, Chris. And maybe the next one, a question for James. I think as we look at margins in the quarter, You saw a sequential kind of step down in adjusted operating margin this quarter. I know you kind of mentioned some incremental expenses by mass hospital margins were about 200 basis points lower versus last quarter and about 100 basis points lower year over year. So that could have also contributed a bit. So I guess as you look ahead and specifically, I guess, longer term, where do you expect the leverage to come from with kind of a more challenged hospital business? And are you expecting kind of the same level of margin expansion that you saw in fiscal 26 next year and beyond? And just maybe it'd be helpful if you could help frame kind of the puts and takes. Thanks.

Yeah, sure, Rowan. So, overall, we are pleased with our margin expansion this year, as it really underscores the quality of our portfolio. As you mentioned, we're up 60 basis points in the quarter. It's up 200 basis points year to date, and all businesses contributed to that expansion. I would just caution you on the quarterly performance by segment. And that could be uneven, you know, just due to product mix and revenue timing, expense cadence, and so forth. So we like to look at that more on a year-to-date or, you know, a trailing, you know, nine-month to 12-month basis. But, you know, overall, you know, we're pleased with, you know, the way this has played out. Now, as we move into the future, you know, we'll look to see smaller increments in margin improvement. So, like, the 200 basis points improvement that we saw, you know, this year, that is going to begin to slow down as we get into the future. The increments in operating margin improvement will be less. There will be 50 basis points or 100 basis points, you know, something more in that range. But overall, there's still room to grow here, operating margin. And, you know, I'll just touch on the point that you brought up on leverage. So, yes, I mean, if the hospital business is having a slower quarter, you're going to see, you know, a leverage impact on us. And, you know, we saw a bit of that in the quarter, but, you know, plasma was so strong, it was able to overcome that. We also were able to overcome. We had a performance-based compensation increment in this quarter due to the performance of the company overall for the year. And that also, you know, was a dynamic versus the quarter in the previous year as well. So that added to it as well. Just to close out, as we finish the year, we held our operating margin guidance at 26% to 27% range that we came out with at the beginning of the year. We may be towards the lower end of that range, and that's all pretty much related to VivaShore and the timing of expenses around the launch of Percucil Elite.

Thank you. And the next question will come from Marie Thiebaud with BTIG. Your line's open.

Good morning. Thanks for taking the questions. A nice job on the quarter. Just wanted to ask one here, and it's really on the IVP business. I know that we're expecting to see a return to growth in fiscal year 27. Maybe you could just give us kind of more of a peek into what's actually happening on the ground. Is the competitor, who was rather aggressive with pricing and free product, is that sort of out of the market at this point? How has your sales team sort of found its footing? Any more details on all of that? And then any timing, I guess, on the MBP label expansion that you referenced? Thanks for taking the question.

Great. Marie, it's Chris. Thank you. Yeah, in the quarter, if I step back and look at IBT holistically, It's important to understand, and we're focused on this as much as anything in the company right now in terms of returning that franchise to growth and a positive contribution, that the negative in the quarter was fully 70% of the 12% decline that we experienced was a function of esophageal cooling. and the disruption from PFA coupled with, you know, a leveling out of the OEM agreement that we think largely annualizes at this point. So it's just important to keep that in mind. Eight and a half of the 12% decline is attributable to those two factors. For vascular closure, you know, it's our number one focus. I've said this recently, you know, that I want to make sure I just reiterate. We are confident we've got the right team. The strategy and the tactics they've put forth are the right ones to return to growth. That effort is fully funded, and you see that kind of in our current P&L. And at this point, we're just putting steps together to do the things that we need to do to be able to return and see that in our operating results as we get into FY27. We're confident that we have the right things in place to do that. We definitely woke up to competition, and that comes in different flavors, but from where we sit, and I happen to be sitting with a group of our advisors last night in electrophysiology, there's no question that the product is highly competitive. It's a superior product to what's out there, and we've got the clinical support to back that up. One of the things that we're looking forward to is that MVP XL label expansion. It's with FDA. The dialogue has been very constructive. I'm not going to try to handicap exactly when the release might come, but it opens up a number of things for us when it does. And I think it will allow us to more broadly promote the product. It lets us work with a number of the IDNs and increasingly with the ASCs to be able to get the product on contract. and we think that top-down as well as the bottom-up grassroots work that we're already doing bodes well for it to be an important part of the recovery to come.

Very good. Thank you so much.

Thank you. And the next question will come from Joanne Winch with City. Your line's open.

Good morning, and thank you so much for answering the question. Could you give us a little bit of color on the Vivishare acquisition? You talk about bringing the product to market in 2027. Anything that you've learned from your initial investment that helps you position for that product launch, or is there anything on the financial aspect of it that you can share at this stage? Thank you.

Thanks, Joanne. Appreciate the question. We're excited about Vivishorp and the Perky Seal Elite product coming to market here shortly. We consummate it, you know, and acted on our option because we really believe that this will meaningfully extend our leadership in vascular closure. It gives us a credible path to category leadership across small, medium, and now large bore procedures as well. It puts us squarely in structural heart with both TAVAR and EVAR procedures, you know, French openings that push into the mid-20s. and the product's going to be indicated for that. It's a really meaningful advance versus what's in the market today. So we're excited. We sized that at roughly a $300 million addressable market. Two-thirds of it's here in the U.S. It sits, as I said, at the intersection of vascular closure and structural heart, which should be a true tuck-in opportunity for us. So we're gearing up for the launch. We are learning from things that went well and less well in our prior launches, and so we're taking a very measured approach, and it'll be a stepwise progress as we go. Once we have the official approval from FDA, we'll be very clear about our plans, but it's going to be stepwise. We're excited about the longer-term potential, but we're going to take the steps that we need early to position this product for long-term success.

As my follow-up question, there's a phrase you used during your opening remarks to deploy capital in a balanced fashion, and I was hoping you could provide some color on how you think about deploying capital at this stage, and thank you so much.

Hi, Joanne. It's James. If I could take a pass at that. So when I think about capital deployment, we strive to be disciplined, balanced, and returns-focused. That's how we think about it. It all starts with strong and growing free cash flow. That provides us the flexibility. We had 95% free cash flow conversion to date, over $200 million in free cash flow this year. So we're well positioned. And for the future, that should continue. The most capital-intensive phase of our transformation is largely behind us. So our priorities remain clear, and really they're unchanged. In the near term, we prioritize organic growth. We have some debt reduction coming up here with the convertible notes that are due here in March. And we also prioritize share buybacks. You saw us do some of that just here at the end of the quarter. So longer term, once IVT execution is restored, we then will look more towards the opportunity for additional M&A like VivaShore. But that's the overall framework about how we're thinking about capital deployment.

Thank you. And the next question will come from David Rescott with Bayard. Your line is open.

Thanks and good morning. I wanted to follow up on some of the comments around the plasma collection and a broader market growth and curious to understand maybe the metrics or visibility you have into the forward looking outlook for that segment. I think in the past you've talked about how there can be ebbs and flows to the business or to the collections market. And I think prior to the past two quarters, you were maybe in that ebb period of low to no growth. And now you've got two quarters of high single and now low double digit seemingly market collection growth. So I'm curious, one, and again, how you're gauging, you know, the sustainability of this accelerated period. And I guess, you know, if the ebb period was six or so quarters, if that's right, you know, why would it be, you know, unreasonable to think that this elevated, you know, collection market growth you've seen now for two quarters should not sustain in the flow period, we'll say, for, you know, a few more quarters.

Yeah, thanks for the question. I think you're right, and I think that's not dissimilar to how we are thinking about it. We work backwards from the end market. When we look at the demand for immunoglobulin-based therapy, both primary and secondary immune deficiency, as well as autoimmune diseases, there is meaningful unmet need where IG is unequivocally still the first-line therapy for a whole host of reasons. It works very well. It's cost-effective, et cetera. So we look at the end market demand. We listen carefully to what our customers are saying to their shareholders and work backwards from that. That bodes very well near intermediate and longer term for this industry. When we step in and now look at what that will translate to in the inevitable cyclicality of collections and inventory levels, our view is that this meaningful uptick in demand actually began six quarters ago. And we met the early stages of that when we rolled out persona and a 10% yield enhancement across the industry. So that gives us confidence that, you know, where are we in the cycle? We're in a building phase, and we're absolutely enabling that for our customers with our technology. In terms of where we go from here, we'll have those discussions. We'll get very clear how many new centers, what's the volume demand, what are they looking at, and we'll back that into our forecast for FY27. At this stage, and I think we established this earlier in the year, we're going to guide to the things that we can control, And that's the share uptick in terms of new centers coming over, and it's a function of the price annualization. So that's what you see reflected in our guidance. We're very happy that we've been able to guide upward with each successive quarter here. But in terms of the volume, I don't disagree with anything you've asserted, but we're not going to put that into our guidance at this stage because we don't control it directly.

That's helpful. And on Bascade, I'm curious more on the fast solar closure market. I think you again called out, you know, increasing PFA as part of a headwind in the Bascade business, if I heard that correctly. I think the latest updates we have at this point maybe is PFA and NAF is 70% or so of the market in the U.S., and so therefore, the increasing utilization of PFA is now, in theory, should have less of a magnitude of an impact on the broader electrophysiology market growth that's eligible for a vascular occlusion device. So, interested to hear what your views are on maybe some of those PFA headwinds beginning to lap and whether the vascular closure market or the interest in vascular closure devices is continuing to step higher and so that as you lap the PFA conversion, maybe the VCD kind of market growth on a blended basis should begin to, you know, step back up to higher levels. Thank you.

David, the effect you're calling out is really important. I think, you know, the PFA launch has been a defining event in electrophysiology for AFib for sure. And some of it is just, you know, we talked about it earlier, kind of sucking out, you know, all the oxygen from the room and being all-consuming in terms of getting clinician mindshare, a lot of that has played through, as you highlight. There is an effect ongoing with the number of access sites. Exactly where that will land, we're still understanding because it's new therapeutic adoption. We know that in some cases, it's a reduction in the number of access sites. It's certainly a change in the sizing, which is why the MVP XL product and the upcoming anticipated FDA release is so critical to be able to compete in that space. We are seeing an uptick in concomitant therapy between AFib and left atrial appendage. That's a net negative in terms of the access sites. I say all that because it will affect the overall size, it affects the overall growth rate in the category in the near term. But as you highlight, as that levels out, and I'll leave it to you and others to kind of forecast exactly when that plays out. But as that levels out, what you will see in terms of access site availability for us, which really determines the TAM, is it will regress to the category's growth rate. And as near as we can tell, that category growth rate is at least mid-teens at this point, which is an uptick for us going forward and gives us optimism about our ability to return to growth in 27 and beyond. So we'll see. We'll work our way through it. We think we've got a really good product, and the main thing we need to do is execute, in particular, head-to-head against our competition where we have lost shares, given the underperformance we've experienced year-to-date. We think it's entirely addressable. We think we have a better product, and we need to make sure our execution matches that.

Thank you.

Thank you. And our next question comes from Anthony Patron with Mizuho. Your line is open.

thanks and uh good morning everyone's making sure you guys can hear me you have me coming in okay yes we do okay great uh two questions one plasma one one ibt chris on plasma we're hearing you know the competitor in the u.s uh there have been issues you mentioned in your prepared remarks that one of the flavors of shared games here is actually at the center level and presumably donors moving away from the competitor

or wanting to donate on Nexus.

So when you think about that, that's a risk for CSL. What's the latest thinking on the potential that CSL comes back to Nexus in some way? Is that a potential? If so, what do you think that can look like?

And then I'll have a follow-up on IBT. Yeah, thanks for the question. I made the assertion up front that I don't think Plasma has ever been stronger across multiple dimensions, and that starts with the quality of our relationships, and I think a number of things that the team did really well through the pandemic and the recovery is they were there for folks. No stockouts, no back orders. We never fail to make a delivery on the devices or the capital, the disposables. That continues. We value our relationship with CSL as we do with all of our customers. We're delighted to have 100% of their international business, to have their U.S. software on a long-term agreement. And so we'll continue to earn all of our customers' trust day in, day out, And I think that bodes really well for our trajectory going forward. Let me just leave it there.

Very helpful. And then on IVT, one of the drivers going forward here is site of service. And ASCs are, you know, sort of a new channel here for electrophysiology, pulmonary vein isolation specifically. It feels like that's where those surgeries are headed. But that seems like it's greenfield for vascular closure as well. So maybe just a little bit on ASEs, like how penetrated are you there at the moment? And are those like new sites where really you can kind of gain new ground here going forward? And how does that play in the growth trajectory for Bass Gate?

Yeah, thanks. I mentioned that we had our electrophysiology advisory board here with us in Boston yesterday. and several of those clinicians are running some of the largest ASCs in the country. They're our customers. We've done a bunch of things with them that I think bode well for our presence in the ASCs. When I take a step back, just to put a little flesh around the efforts we have underway, one of the critical gaps that we identified earlier in the year is corporate accounts presence, both for ASCs, as well as for IDNs. And we've meaningfully strengthened that capability over the course of the year. We think what we offer in vascular closure, particularly now that we have this full spectrum from six French to 25 French, is the opportunity to be their partner on vascular closure and increasingly push venous and arterial across the board. So the conversation is, how does this fit in their operations, the speed of ambulation, the absence of narcotics, the significant reduction in re-bleeds is all very powerful value prop for the ASEs. We think that establishes a new growth vector for us heading into FY27, and we're going to be excited to capitalize on it.

Thank you.

Thank you. and the next question will come from Mike Mattson with Needham & Company. Your line is open.

Yeah, thanks. So I wanted to ask one on, you know, in interventional technologies, the Savvy Wire product. I didn't really hear any commentary on that. So can you talk about maybe what the growth was with that and, you know, what you need to do to kind of make that become more of a growth driver because it seems like a pretty unique

and interesting product within that portfolio. Yeah, Mike, thanks for the question. SavvyWire is a mixed story for us at the moment. I called out this 70%, fully 8.5 points of the 12 points of decline in interventional was attributed to esophageal cooling and the OEM portion of SavvyWire. And so we have a very good relationship that we inherited with the Opsense acquisition where we're providing the product for the impella pump. There's been some re-leveling of that. There's a dual manufacturing site and kind of, you know, kind of rebalancing. That's largely played through. We may have one more quarter of that that we have to work through. But, you know, that will ultimately regress to the growth of the underlying pump market, which we think is, you know, mid-teens or better. And we're excited about that. In the near term and the quarter, it was absolutely a headwind for us. If I flip over to the other side of the guidewire business, the actual structural heart play, very powerful. And we see good uptake there. The bifurcation of our efforts between closure and structural heart guidewire has helped, although it's still, in fairness, early innings into that focus. We're cautiously optimistic. We think that'll be a big part of what drives us in 27, but we need to see that come through. Interestingly, we don't talk much about OptiWire, which is the other part of the GuideWire business, but one of the things we're hearing, back to the prior question about the ASCs, OptiWire is very attractively priced for what it delivers. It has a really clean value proposition and seems to be gaining early traction with the ASCs. We hope to be able to build upon that going forward.

Okay, thanks. And then BloodCenter was positive this quarter, and I think you said it was positive year-to-date. So are we now at a point where that business can stay in the green in terms of growth from here, especially given the plasma part of the business seems like it's seeing stronger growth?

Yeah, it's a tale of two halves as we go through that. I think as it pertains to plasma apheresis, this is done by the blood center customers. So as an example, it's Egypt, but I can say the same thing about France or Canada or Turkey. We are working with local blood center customers that have partnered with one of the larger sourcing fractionators to help collect them, you know, help them get collected and kind of drive forward. And so we offer them a turnkey proposition. That's what's going to drive the continued performance in blood center globally. The other half of the business is the remaining apheresis on platelets and red cells. And invariably, that toggles up or down. It's very subject to order timing. And in general, you know, it's a stagnant market. We do well in that market. They're making a really, you know, through the rationalization, their contribution, you'll see that in some of our breakout tables, has meaningfully improved. So they're playing their role in our corporate strategy for margin expansion, but they just don't have the long-term growth potential because the market doesn't have the long-term growth potential. So we'll take a hard look at that before we guide for 27, but we will see a relative difference between two paths of that business going forward. Okay, thank you.

Thank you. And the next question will come from Michael Petusky with Barrington Research. Your line is open.

Good morning. Chris, so the guide for hospital for fiscal 26 seems to imply that you guys deliver the best quarter in hospital on a reported basis of the year. And I'm just curious, is that mostly a function of sort of the order timing issue reversing, or are you seeing, you know, meaningful sort of clawbacks on some of the business that you, you know, may have lost in vesicle closure? I'm just curious, you know, it's a fairly bullish, you know, forecast, you know, relative to what you guys just reported. I'm just curious what's driving that, thanks.

Yeah, Mike, thanks for the question. You're exactly right. It is a bullish forecast for the fourth quarter. We felt comfortable guiding to the low end of the existing range because predominantly of the strength that we're seeing in blood management technologies this quarter. TAG continues to push forward. We're midstream here in this TAG 5000 system upgrade. We have line of sight to the capital there that has us enthusiastic. And then we're seeing this really meaningful uptake on a TAG disposable basis. We're generating roughly twice the usage from the existing TAG successes that we did, you know, even just two years ago. So BMT is going to have to carry the water for us for sure in the fourth quarter, well onto the double digits. But to your question, we also need to see a beginning of the stabilization in IVT. And I think some of that is order timing. Some of that is head-to-head competition where, you know, we're clawing back things we lost or stabilizing. And, you know, we talk a lot about the investments we need to make in interventional technologies. I've called those out repeatedly. I feel like we've made the investment. We're not looking at further dilution or outflows there. You'll see certain things. We've guaranteed some of these highly competitive territories on a quota basis to get the right people in the seat and get them motivated. So there's some expense associated with that. That's already reflected in our P&L. We're also being purposeful about things that would encourage new usage without wrecking our margins. So we're going to continue to make those investments. We think we'll begin to see the stabilization of that in the fourth quarter. So we pair the losses, not entirely, but partially, and the combination of those two things, really strong, continued strong performance in BMT with the beginnings of stabilization and IVT should get us to land where we want to land for the year, but also set us up nicely for growth in FY27 across the hospital franchise.

Okay, great. And if I could follow up, and you may have, you know, partially answered this question in your response just now, but, you know, you guys a couple quarters ago when you sort of ran into, you know, meaningful issues in vascular closure, sort of called out 50 accounts where you felt like, hey, we sort of got our lunch in some of these, you know, in these 50 accounts. and obviously you put in a lot of changes very quickly as a response. And I'm just curious, I assume that you're probably tracking data from those 50 accounts that you guys identified, you know, six months ago. And I'm just curious, you know, are you at this point sort of trading punches or are you still losing a little there, but do you feel like you're sort of seeing some anecdotal evidence of the turnaround? Or what are you seeing in those accounts that you identified, you know, a couple of quarters ago?

Thanks. Yeah, Mike, the tagline, I assure you we are giving at least as good as we get these days. One of the things we've done is really strengthen our commercial operations. And we have a much better handle through some of the obvious tools, Salesforce, et cetera, that track that performance. So we are paying very close attention to the individual account wins and losses. And win backs, you know, are super critical for our longer-term success. We have two very different competitors. One is the established, you know, industry standard, and they've meaningfully beefed up their commercial presence. They're working through their corporate accounts team with their new product launch in AFib. So, you know, that's formidable, and we want to be mindful of that. We think there's a role for us as a more innovative, highly legitimate number two in the category. On the other end, yeah, we talk about the mix product and some of the things they did early on to secure a foothold. We made it easy on them. I can assure you there's nothing easy about it in that category today. We have a team that's fit for task, that's out there fighting for what's rightfully theirs. We value the winbacks highly, and I can tell you the balance has shifted, and that's what gives us optimism on a go-forward basis that it was never the product and it was never the market and therefore you know we control this outcome if we're committed to it and I assure you we have no higher priority as a company right now than to return IVT to growth and that starts with vascular

closure especially in AFib great thanks Chris thank you and the next question will come from Andrew Cooper with Raymond James your line is open hey

Hey, thanks, everybody. Maybe first, I want to follow up on something you just said there, Chris, when you said the balance has shifted. Can you give us a little bit of a sense for what is it that you're seeing that it's telling you that that balance has shifted? Because I think we've all sort of known for some time that the Vastade product, MVP and XL, are well thought of by clinicians. And so when we look at the data, when we look at the performance, I don't think that piece is what's changed. So what informs that view that the balance has shifted kind of ahead of seeing the volume in the revenues showing that shift?

Yep. I think the bifurcation that we put in place earlier in the year is really starting to yield the results we anticipated. it. We have 200 field-based representatives who get out of bed every day and think first, second, and third about closure. And we know that more than two-thirds of that opportunity today is in electrophysiology for MVP and for MVP XL. So we're tracking how those folks are spending their time and their win rates, and we're increasingly confident about that. We still had gaps in our own field force, open territories where we had faced the most stiff competition and our folks weren't able to respond for whatever set of reasons. So as we close those vacancies, as we watch these new reps come up the learning curve, it's really powerful. I don't think we've said this publicly before, but at this point, fully 60% of our field team has been in their territory in their current role less than six months. That's an important number to keep in mind as you gauge our competitive response. There is a learning curve. These are very talented individuals, but they were hired because they were fit for purpose for the task we need from them, and they have a faster uptick than you would otherwise expect, but there's still an uptick, and we've got to give this team an opportunity to really get traction, I think, as I called out earlier, some of the key account work we're doing with the IDNs is providing them the air cover to be able to go in and pull through the business. And I think that's another place where we were getting out-executed by the competition. We've turned the tide on that, and I'm pleased to say we've turned the tide on that without meaningfully compromising our gross margin, our price points. We have a great product. When it's properly presented and has the appropriate air cover, we win. And that's what you should expect from us going forward.

Okay, that's super helpful and look forward to sort of seeing the fruits of all that come together. Shifting a little bit to plasma, I did just want to ask, and I think maybe you touched on it a little, but when we look at the fiscal 3Q going into the fiscal 4Q implied numbers, It looks like a little bit bigger than the typical seasonal step down in fiscal 4Q. So I just want to get a sense for, is that conservatism? Was there any stocking around some of these fair gains or anything to think about on, you know, I know you had that chunky software renewal earlier in the year, just trying to get a sense for anything that would explain maybe that step down or, you know, is it really just trying to take a prudent approach to close out the year?

Yeah, prudent is the exact right word, Andrew. We had a really good third quarter, obviously, above historic seasonality, number one driver in the quarter, and now year-to-date were the share gains. So there was nothing around, you know, order timing or one-offs that you need to factor in there. It's just us guiding on the things we can directly control, you know, further share uptick in the final, final stages of annualization from last year's technology rollout. collection volume. We'll leave it to you guys to figure out what you think is the right number to plug in there. Our guidance reflects what we can control. Okay, great. I'll stop there. Thank

you. Thank you. Thank you. I am showing no further questions in the queue. This will conclude today's conference call. Thank you for participating, and you may now disconnect.