Dentsply Sirona Delivers Solid Q4 2025 Results
Dentsply Sirona Inc. (NASDAQ: XRAY) reports fourth-quarter 2025 net sales of $961 million, reflecting a 6.2% year-over-year increase on a reported basis and 2.5% growth in constant currency terms. Adjusted EBITDA reached $135 million with a margin of 14.1%, while adjusted EPS rose 4.9% to $0.27. The quarter included a $144 million non-cash goodwill impairment charge primarily due to tariff impacts and volume pressures.
Free cash flow improved to $60 million, supported by higher operating cash flow. Cash and equivalents stood at $326 million at quarter-end, with net debt to EBITDA at 3.0x.
Full-Year 2025 Overview
For the full year, net sales totaled $3.68 billion, down 3.0% reported and 4.3% in constant currency, partly offset by Byte business impacts. Adjusted EBITDA margin expanded 150 basis points to 18.1%, driven by lower SG&A expenses despite tariff headwinds of $23 million. Adjusted EPS came in at $1.60, aligning with prior guidance.
Free cash flow was $104 million, impacted by working capital changes. Dividends paid totaled $128 million for the year.
Segment Performance in Q4
- Connected Technology Solutions (CTS): $299 million, constant currency down 1.9%, with U.S. growth offsetting declines in CAD/CAM elsewhere.
- Essential Dental Solutions (EDS): $372 million, up 4.0% constant currency, led by Rest of World gains.
- Orthodontic and Implant Solutions (OIS): $202 million, up 6.9% constant currency, boosted by prior-year Byte refunds; implants declined amid regional softness.
- Wellspect Healthcare: $88 million, up 1.9% constant currency, with U.S. strength.
Return to Growth Action Plan
Executives outline a 24-month transformation plan anchored in five pillars: customer-centric mindset, sustainable growth, performance empowerment, organizational scaling, and financial strength. Key initiatives include 50% higher clinical education investment, double-digit R&D increase for DS Core and key portfolios, unified U.S. commercial teams, and new dealer agreements with Benco, Patterson, Burkhart, and A-dec.
Daniel Scavilla, President and CEO, emphasized, “We are going deeper, moving faster, and being bolder to drive sustained profitable growth.” The plan features restructuring for $120 million in annual savings, redirected to growth investments.
2026 Financial Outlook
Guidance projects net sales of $3.5 billion to $3.6 billion, implying 1% to 3% operational decline in constant currency excluding Byte and new dealer inventory shifts. Adjusted EPS targets $1.40 to $1.50. Investments peak in 2026 before becoming self-funding.
Capital Allocation Shift
The company eliminates its dividend, freeing $128 million annually for debt reduction and share repurchases. Scavilla noted, “At these prices, I want to move into buying back shares.” Priority focuses on maintaining investment-grade status while accelerating buybacks as restructuring progresses.
U.S. recovery emphasizes multichannel sales, implant focus, and ortho software upgrades. R&D ramps to around 5% of sales, targeting acceleration in connected dentistry and innovation pipelines.
