TMDX earnings analysis
What we found in TMDX's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
TransMedics delivered Q2 revenue of $189.948 million, up 20.7% year over year and above consensus, led by service revenue growth of 28.6% and U.S. liver revenue growth of $32.127 million. However, gross margin fell to 60% from 61%, operating margin declined to 12.5% from 23.2%, and GAAP diluted EPS decreased to $0.41 from $0.92, reflecting sharply higher development, infrastructure and finance-lease costs. Liquidity is substantial at $472.7 million of cash, but first-half operating cash flow fell to $41.842 million and management disclosed a material weakness in interim inventory-movement controls.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue grew 21% and beat consensus
- Q2 revenue was $189.948 million, up $32.578 million, or 20.7%, from $157.370 million a year earlier and up approximately 9.2% from $173.933 million in Q1 2026. Revenue exceeded the $184.061 million consensus estimate by 3.2%.
- NOP-driven service revenue outgrew product
- Service revenue increased $17.520 million to $78.790 million, outpacing the $15.058 million increase in product revenue to $111.158 million. Management attributed U.S. growth to higher OCS Liver disposable-set volumes and increased NOP usage.
- Liver remained the principal growth driver
- U.S. liver revenue increased $32.127 million to $147.989 million, more than offsetting a $1.901 million reduction in U.S. lung revenue to $2.253 million. Total U.S. OCS transplant revenue rose $31.436 million to $183.623 million.
- Sequential profitability and liquidity improved
- Operating margin improved sequentially to 12.5% in Q2 from approximately 7.6% in Q1, as operating income increased to $23.736 million from $13.297 million. Cash at June 30 was $472.7 million, and management believes existing cash funds operations, capex and debt service for at least 12 months.
- Operating cash flow remained positive
- Six-month operating cash flow was positive $41.842 million, despite $36.8 million of working-capital use. Investing cash outflow of $43.749 million was primarily for Somerville land and building purchases.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Year-over-year margin and EPS compression
- Margins and earnings remain below prior-year levels: Q2 gross margin declined to 60% from 61%, operating income fell $12.831 million to $23.736 million, and GAAP diluted EPS was $0.41 versus $0.92 a year earlier. Gross-margin pressure reflected a larger service mix and lower product margin.
- Investment spending materially outpaced revenue
- R&D expense nearly doubled to $31.632 million from $15.934 million, including a $10.564 million increase in consulting and third-party services for next-generation OCS and OCS Kidney development. SG&A rose $13.742 million to $57.830 million.
- Material weakness in inventory controls
- Management concluded disclosure controls were not effective as of June 30, 2026 because controls over interim inventory movement were deficient. Inventory increased $10.2 million and accounts receivable increased $19.9 million during the first six months of 2026.
- Cash conversion weakened amid elevated capex
- Operating cash flow declined to $41.842 million in the first half of 2026 from $88.754 million a year earlier, while capital spending was $43.749 million. Planned headquarters capex is approximately $200 million-$240 million through 2030, with $12.7 million committed as of June 30, 2026.
- No new Item 1A risk-factor disclosures
- No amendments to the Item 1A risk factors were identified; the filing directs investors to the risk factors in the 2025 Form 10-K. Separately, the company has $460.0 million of 1.5% convertible notes maturing June 1, 2028 and a $60.0 million CIBC loan with principal repayments beginning in July 2026.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.41
- Gross margin
- 59.6%
- Operating margin
- 12.5%
- Segment
- Net product revenue: $111.158 million, up $15.058 million (15.7%) year over year.
- Segment
- Service revenue: $78.790 million, up $17.520 million (28.6%) year over year.
- Segment
- U.S. OCS transplant revenue: $183.623 million, up $31.436 million (20.7%); U.S. liver revenue rose $32.127 million to $147.989 million, heart rose $1.210 million to $33.381 million, and lung declined $1.901 million to $2.253 million.
- Segment
- International OCS transplant revenue: $5.241 million, up $1.081 million (26.0%), led by heart revenue of $4.587 million versus $3.495 million.
What they said about what is next.
The 10-Q provides no explicit revenue or EPS guidance. Management expects long-term revenue growth and projects a 2026 effective income-tax rate of 25%-27%; it estimates new-headquarters capital expenditures of approximately $200 million-$240 million through 2030.
The filing reads about the same as the one before it.
What came before.
- 10-Q · May 5, 2026
- TransMedics reported Q1 2026 revenue of $173.9 million, a year-over-year increase of $30.4 million, although it missed analyst EPS estimates at $0.20 versus $0.61 expected. The company observed significant growth in…
- 10-K · February 24, 2026
- TransMedics reports strong multi-year revenue growth to $605.5 million in 2025 (up 37.1% year-over-year) driven by its FDA‑approved Organ Care System (OCS) product platform and growth of its National OCS Program (NOP).…
- 10-Q · October 29, 2025
- TransMedics reported Q3 revenue of $143,823,000 (up $35,062,000, +32.2% YoY) and GAAP diluted EPS of $0.66 (vs $0.12 a year ago), driven by product and service revenue expansion and higher operating income. The company…
- 10-Q · July 30, 2025
- TransMedics reported a strong Q2 2025 with revenue of $157,370,000 (+$43,065,000, +37.7% vs Q2 2024) and diluted EPS of $0.92 (vs $0.35 in Q2 2024), materially beating consensus. Gross margin held at ~61.4% and…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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