Penumbra Inc. ((PEN)) has held its Q2 earnings call. Read on for the main highlights of the call.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Penumbra Inc.’s recent earnings call painted a picture of robust growth and strategic execution, particularly in the U.S. thrombectomy sector. The company showcased positive momentum with strong revenue growth and promising clinical trial developments. However, challenges in international markets, notably in China, and variability in operating margins due to strategic investments were highlighted as areas of concern.
Strong Revenue Growth
Penumbra reported a total revenue of $339.5 million for Q2 2025, marking a 13.4% year-over-year increase on a reported basis and 12.7% on a constant currency basis. This growth underscores the company’s successful strategies in expanding its market presence and product offerings.
U.S. Thrombectomy Business Success
The U.S. thrombectomy business demonstrated impressive growth, with revenues increasing by 22.6% year-over-year to $188.5 million. The U.S. VTE franchise was a significant contributor, growing by 42% year-over-year, highlighting Penumbra’s strong foothold in the domestic market.
Gross Margin Improvement
Penumbra’s gross margin improved significantly to 66% in Q2 2025, up from 54.4% in the same quarter the previous year, excluding a one-time inventory write-off. This improvement reflects the company’s effective cost management and operational efficiency.
Positive Clinical Trial Enrollment
The company completed enrollment in the STORM-PE trial ahead of schedule, with results anticipated to be presented at a major medical conference in the fall. This development is a testament to Penumbra’s commitment to advancing clinical research and innovation.
Increased Full-Year Revenue Guidance
Penumbra raised its total revenue guidance for 2025 to a range of $1.355 billion to $1.370 billion, representing a 13% to 15% year-over-year growth. This optimistic outlook is driven by strong performance in key business areas.
Challenges in China
International revenue faced a decline, with a 3.2% decrease reported and a 5.8% drop in constant currency, primarily due to reduced revenue from China. This highlights the challenges Penumbra faces in navigating international market dynamics.
Operating Margin Variability
Operating margins were affected by strategic investments in the commercial team, with non-GAAP operating expenses at $183.2 million or 54% of revenue. This variability indicates the company’s focus on long-term growth despite short-term margin pressures.
Softness in Neurovascular Market
The neurovascular stroke market experienced slower growth, although Penumbra continued to gain market share. This suggests resilience in maintaining competitive positioning despite market challenges.
Forward-Looking Guidance
Penumbra’s forward-looking guidance reflects confidence in continued growth, with an updated revenue forecast of $1.355 billion to $1.370 billion for 2025, indicating a 13% to 15% increase year-over-year. The U.S. thrombectomy business is expected to grow by 20% to 21%, and gross margins are projected to exceed 70% by the end of 2026.
In summary, Penumbra Inc.’s earnings call highlighted a strong performance with significant growth in the U.S. thrombectomy business and improved gross margins. While challenges in international markets and operating margin variability pose concerns, the company’s optimistic revenue guidance and strategic focus on innovation and market expansion provide a positive outlook for the future.