Henry Schein, Inc. reported second-quarter 2025 financial results, with net sales of $3.24 billion, a 3.3% increase over Q2 2024. However, the company's non-GAAP diluted EPS was $1.10, missing analyst consensus estimates of $1.18.
The decline in profitability was primarily attributed to lower gross margins within the U.S. Distribution business, specifically due to competitive glove pricing and targeted sales initiatives. The GAAP operating margin was 4.67%, a 42 basis point decrease year-over-year, while non-GAAP operating margin stood at 6.96%, down 79 basis points.
Despite the profit miss, Henry Schein maintained its financial guidance for the full year 2025, expecting earnings to be weighted towards the second half of the year. The company recorded $23 million in restructuring costs during the quarter and expects to achieve over $100 million in annual run-rate savings by the end of 2025.
Henry Schein repurchased approximately 3.7 million shares of common stock for $259 million in the second quarter, including $223 million under its Accelerated Stock Repurchase plan. The company is also collaborating with KKR Capstone and global management consulting firms to enhance distribution gross margins and increase company-wide efficiencies, with results expected in early 2026.
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