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TMDX Dips After Posting Q1 Earnings & Revenue Miss, Margins Fall
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Key Takeaways
TransMedics posted Q1 EPS of $0.30, down 59.5% YoY, missing estimates by 51.6%.
TMDX's revenues grew 21% to $173.9M, driven by OCS adoption and logistics services expansion.
TransMedics saw margin contraction as expenses surged despite growth in products and services.
TransMedics Group (TMDX - Free Report) delivered earnings per share (EPS) of 30 cents in the first quarter of 2026, down 59.5% year over year. The figure missed the Zacks Consensus Estimate by 51.6%.
TMDX’s Q1 Revenues in Detail
TransMedics registered revenues of $173.9 million in the first quarter, up 21% year over year. The figure fell short of the Zacks Consensus Estimate by 1%.
Per management, the year-over-year rise was driven by the increased utilization of the Organ Care System ("OCS"), primarily in Liver and Heart through the National OCS Program ("NOP"), as well as additional revenues generated by TransMedics logistics services.
During the reported quarter, TMDX was able to cover 82% of its NOP missions requiring air transport compared with 78% in the first quarter of 2025.
However, shares of TransMedics lost 19.7% in yesterday’s after-market trading. The company’s shares have declined 22% in the year-to-date period compared with the industry’s fall of 16.6%. However, the broader S&P 500 Index has increased 6% in the same time frame.
Image Source: Zacks Investment Research
TransMedics’ Segment Details
TMDX derives revenues via two sources: Net product revenues and Service revenues.
In the first quarter of 2026, Net product revenues totaled $108 million, up 22% year over year. Growth was driven by continued strong liver performance and modest growth in the heart.
Service revenues totaled $66 million, up 19% year over year, driven primarily by logistics revenues, supported by increased utilization of the TransMedics aviation fleet.
Transplant Logistics’ services revenues for first-quarter 2026 were $32 million, up 22% year over year. This resulted from the continued expansion and strong utilization of TransMedics’ aviation fleet.
TMDX’s Margin Trend
In the quarter under review, TransMedics’ gross profit increased 14.7% year over year to $101.2 million. The gross margin contracted 331 basis points (bps) to 58%.
Selling, general and administrative expenses rose 44.4% year over year to $62.9 million. Research, development and clinical trials expenses surged 45% year over year to $24.9 million. Total operating expenses of $87.9 million increased 44.5% year over year.
Adjusted operating profit totaled $18.1 million, reflecting a downtick of 39.2% from the prior-year quarter. The adjusted operating margin in the first quarter contracted 1030 bps to 10.4%.
TransMedics’ Financial Position
TransMedics exited first-quarter 2026 with cash of $461.7 million compared with $488.4 million at the end of 2025. Total long-term debt at the end of first-quarter 2026 was $44.5 million compared with $49.6 million at the end of 2025.
Cumulative net cash provided by operating activities at the end of first-quarter 2026 was $24.5 million, against net cash used in operating activities of $2.9 million a year ago.
TMDX’s 2026 Guidance
TransMedics reiterated its revenue outlook for 2026.
For 2026, the company expects revenues in the range of $727-$757 million, reflecting growth of 20-25% from the 2025 level. The Zacks Consensus Estimate is pegged at $739.7 million.
TransMedics Group, Inc. Price, Consensus and EPS Surprise
TransMedics delivered mixed first-quarter 2026 results, where solid top-line growth was overshadowed by profitability pressure and an earnings miss. Quarterly performance was driven bygrowing OCS case volume, increased clinical adoption and expanding logistics services. While earnings per share declined year over year due to elevated investments, results still exceeded expectations, signaling underlying strength in the business. However, both gross margin and operating margin contraction during the quarter were disappointing.
Growth was supported by balanced contributions from both product and service segments. Transplant product revenues benefited from strong liver performance and steady heart adoption, while logistics services continued to scale. Increased utilization of the company’s aviation fleet and improved operational efficiency further reinforced the value of its integrated National OCS Program (NOP).
TransMedics is accelerating investments in 2026, positioning the year as a transformational phase. Strategic priorities include advancing the ENHANCE Heart and DENOVO Lung programs, expanding international operations and progressing the OCS Kidney platform. The kidney program, built on the new Gen 3.0 platform, represents a significant opportunity to penetrate the largest segment of the transplant market and drive long-term growth.
A notable development is the introduction of the Controlled Hypothermic Organ Preservation System (CHOPS), designed to complement existing technologies and expand the company’s product portfolio. CHOPS targets shorter-duration transplant scenarios, allowing TransMedics to address a broader spectrum of clinical needs while strengthening its competitive positioning.
International expansion is also gaining momentum, with early infrastructure development underway in Europe and partnerships being formed to replicate the NOP model overseas.
Despite near-term margin pressure from increased investments, TransMedics remains confident that these investments will drive long-term operating leverage and market expansion.
TMDX’s Zacks Rank & Key Picks
TransMedics currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are West Pharmaceutical Services, Inc. (WST - Free Report) , Intuitive Surgical (ISRG - Free Report) and Cardinal Health, Inc. (CAH - Free Report) .
West Pharmaceutical reported first-quarter 2026 EPS of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
West Pharmaceutical has a long-term estimated growth rate of 13.9%. WST’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.37%.
Intuitive Surgical reported first-quarter 2026 adjusted EPS of $2.50, beating the Zacks Consensus Estimate by 20.19%. Revenues of $2.77 billion surpassed the Zacks Consensus Estimate by 6.2%. It currently carries a Zacks Rank of 2 (Buy).
Intuitive Surgical has a long-term estimated growth rate of 14.9%. ISRG’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.82%.
Cardinal Health, carrying a Zacks Rank of 2 at present, reported third-quarter fiscal 2026 adjusted EPS of $3.17, which beat the Zacks Consensus Estimate by 13.2%. Revenues of $60.94 billion missed the Zacks Consensus Estimate by 2.3%.
Cardinal Health has a long-term estimated growth rate of 15.6%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 10.27%.
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TMDX Dips After Posting Q1 Earnings & Revenue Miss, Margins Fall
Key Takeaways
TransMedics Group (TMDX - Free Report) delivered earnings per share (EPS) of 30 cents in the first quarter of 2026, down 59.5% year over year. The figure missed the Zacks Consensus Estimate by 51.6%.
TMDX’s Q1 Revenues in Detail
TransMedics registered revenues of $173.9 million in the first quarter, up 21% year over year. The figure fell short of the Zacks Consensus Estimate by 1%.
Per management, the year-over-year rise was driven by the increased utilization of the Organ Care System ("OCS"), primarily in Liver and Heart through the National OCS Program ("NOP"), as well as additional revenues generated by TransMedics logistics services.
During the reported quarter, TMDX was able to cover 82% of its NOP missions requiring air transport compared with 78% in the first quarter of 2025.
However, shares of TransMedics lost 19.7% in yesterday’s after-market trading. The company’s shares have declined 22% in the year-to-date period compared with the industry’s fall of 16.6%. However, the broader S&P 500 Index has increased 6% in the same time frame.
Image Source: Zacks Investment Research
TransMedics’ Segment Details
TMDX derives revenues via two sources: Net product revenues and Service revenues.
In the first quarter of 2026, Net product revenues totaled $108 million, up 22% year over year. Growth was driven by continued strong liver performance and modest growth in the heart.
Service revenues totaled $66 million, up 19% year over year, driven primarily by logistics revenues, supported by increased utilization of the TransMedics aviation fleet.
Transplant Logistics’ services revenues for first-quarter 2026 were $32 million, up 22% year over year. This resulted from the continued expansion and strong utilization of TransMedics’ aviation fleet.
TMDX’s Margin Trend
In the quarter under review, TransMedics’ gross profit increased 14.7% year over year to $101.2 million. The gross margin contracted 331 basis points (bps) to 58%.
Selling, general and administrative expenses rose 44.4% year over year to $62.9 million. Research, development and clinical trials expenses surged 45% year over year to $24.9 million. Total operating expenses of $87.9 million increased 44.5% year over year.
Adjusted operating profit totaled $18.1 million, reflecting a downtick of 39.2% from the prior-year quarter. The adjusted operating margin in the first quarter contracted 1030 bps to 10.4%.
TransMedics’ Financial Position
TransMedics exited first-quarter 2026 with cash of $461.7 million compared with $488.4 million at the end of 2025. Total long-term debt at the end of first-quarter 2026 was $44.5 million compared with $49.6 million at the end of 2025.
Cumulative net cash provided by operating activities at the end of first-quarter 2026 was $24.5 million, against net cash used in operating activities of $2.9 million a year ago.
TMDX’s 2026 Guidance
TransMedics reiterated its revenue outlook for 2026.
For 2026, the company expects revenues in the range of $727-$757 million, reflecting growth of 20-25% from the 2025 level. The Zacks Consensus Estimate is pegged at $739.7 million.
TransMedics Group, Inc. Price, Consensus and EPS Surprise
TransMedics Group, Inc. price-consensus-eps-surprise-chart | TransMedics Group, Inc. Quote
Our Take on TransMedics’ Q1 Results
TransMedics delivered mixed first-quarter 2026 results, where solid top-line growth was overshadowed by profitability pressure and an earnings miss. Quarterly performance was driven bygrowing OCS case volume, increased clinical adoption and expanding logistics services. While earnings per share declined year over year due to elevated investments, results still exceeded expectations, signaling underlying strength in the business. However, both gross margin and operating margin contraction during the quarter were disappointing.
Growth was supported by balanced contributions from both product and service segments. Transplant product revenues benefited from strong liver performance and steady heart adoption, while logistics services continued to scale. Increased utilization of the company’s aviation fleet and improved operational efficiency further reinforced the value of its integrated National OCS Program (NOP).
TransMedics is accelerating investments in 2026, positioning the year as a transformational phase. Strategic priorities include advancing the ENHANCE Heart and DENOVO Lung programs, expanding international operations and progressing the OCS Kidney platform. The kidney program, built on the new Gen 3.0 platform, represents a significant opportunity to penetrate the largest segment of the transplant market and drive long-term growth.
A notable development is the introduction of the Controlled Hypothermic Organ Preservation System (CHOPS), designed to complement existing technologies and expand the company’s product portfolio. CHOPS targets shorter-duration transplant scenarios, allowing TransMedics to address a broader spectrum of clinical needs while strengthening its competitive positioning.
International expansion is also gaining momentum, with early infrastructure development underway in Europe and partnerships being formed to replicate the NOP model overseas.
Despite near-term margin pressure from increased investments, TransMedics remains confident that these investments will drive long-term operating leverage and market expansion.
TMDX’s Zacks Rank & Key Picks
TransMedics currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are West Pharmaceutical Services, Inc. (WST - Free Report) , Intuitive Surgical (ISRG - Free Report) and Cardinal Health, Inc. (CAH - Free Report) .
West Pharmaceutical reported first-quarter 2026 EPS of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
West Pharmaceutical has a long-term estimated growth rate of 13.9%. WST’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.37%.
Intuitive Surgical reported first-quarter 2026 adjusted EPS of $2.50, beating the Zacks Consensus Estimate by 20.19%. Revenues of $2.77 billion surpassed the Zacks Consensus Estimate by 6.2%. It currently carries a Zacks Rank of 2 (Buy).
Intuitive Surgical has a long-term estimated growth rate of 14.9%. ISRG’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.82%.
Cardinal Health, carrying a Zacks Rank of 2 at present, reported third-quarter fiscal 2026 adjusted EPS of $3.17, which beat the Zacks Consensus Estimate by 13.2%. Revenues of $60.94 billion missed the Zacks Consensus Estimate by 2.3%.
Cardinal Health has a long-term estimated growth rate of 15.6%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 10.27%.