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• Sales: Approximately $168 million, adjusted for foreign exchange and strategic revenue withdrawal.

• Organic Sales Growth: Up 2.8% compared to a year ago.

• Adjusted Diluted EPS: $0.26.

• Adjusted EBITDA: Approximately $22 million.

• Adjusted Gross Margin: 56.7%.

• SG&A as Percentage of Revenue: 43.4%.

• Cash on Hand: $97 million as of March 31.

• Debt Outstanding: $107 million as of March 31.

• Free Cash Flow: $19 million for the quarter; estimated $65 million for 2025.

• Specialty Nutrition Systems Organic Growth: Almost 9% versus prior year.

• Specialty Nutrition Systems Operating Profit: Nearly 21%, a 460 basis point increase from prior year.

• Pain Management and Recovery Organic Sales Growth: Up 2.4%, excluding foreign exchange impacts.

• Pain Management and Recovery Operating Profit: Break even, a nearly 400 basis point improvement from a year ago.

• Hyaluronic Acid Injections and Intravenous Infusion Decline: Over 30% combined during the first quarter.

• Tariffs Incurred: $1.5 million in the first quarter, with an estimated $15 million in incremental costs for the year.

• 2025 Revenue Estimate: $665 million to $685 million.

• 2025 Adjusted EPS Estimate: Lowered to $0.75 to $0.95.

• Warning! GuruFocus has detected 4 Warning Signs with AVNS.

Release Date: May 06, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Avanos Medical Inc (NYSE:AVNS) delivered strong first-quarter results with notable progress in its Pain Management and Recovery segment.

• The Specialty Nutrition Systems segment grew almost 9% organically, reaffirming its number one position in long-term, short-term, and neonatal enteral feeding.

• The company achieved $0.26 of adjusted diluted earnings per share and approximately $22 million of adjusted EBITDA.

• Avanos Medical Inc (NYSE:AVNS) generated $19 million in free cash flow during the quarter, supporting its estimate of $65 million for 2025.

• The company has a strong balance sheet with $97 million of cash on hand and $107 million of debt outstanding, providing strategic flexibility.

Negative Points

• Avanos Medical Inc (NYSE:AVNS) faces significant uncertainty regarding the impact of tariffs, with an estimated $15 million in incremental tariff-related manufacturing costs for the year.

• The company lowered its 2025 adjusted earnings per share estimate range to $0.75 to $0.95 due to tariffs and one-time executive leadership change costs.

• The Pain Management and Recovery segment had mixed results, with the surgical pain business down compared to the prior year.

• The hyaluronic acid injections and intravenous infusion product lines declined over 30% combined during the first quarter due to pricing pressures.

• The company anticipates a softer Q2 for its Specialty Nutrition Systems segment due to distributor order timing.