DENTSPLY SIRONA Inc Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Elizabeth Anderson - Evercore ISI - Analyst : Hi guys. good morning Elizabeth, Simon here. So, as you noted, we have factored the tariffs into the current guidance with where tariffs are today. It is -- we have contemplated approximately $0.10 of impact today, and we have -- we're covering that throughout the year. So, on an annualized basis, we think the tariff exposure as of today is about $50 million. As you know, we have a large manufacturing footprint outside of the US and about half of our US sales are generated from goods that are manufactured outside of the US Anything else that comes in, we will -- we've got some options for how to deal with those, but we won't provide any color on what those -- what we think that is right now and if there is any retaliatory impacts from Europe, but we have plans in place to deal with any subsequent issues.

Question: Elizabeth Anderson - Evercore ISI - Analyst : Got it. No, that's super helpful. Thank you. Appreciate the additional color. And then one -- another question. could you update us on where we are with sort of the CFO search? I know Herman was obviously temporary in an interim, so just wanted to get your latest thoughts there as well.

Question: Elizabeth Anderson - Evercore ISI - Analyst : Great. Thank you so much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 08, 2025 / 12:30PM, XRAY.OQ - Q1 2025 DENTSPLY SIRONA Inc Earnings Call

Question: Michael Cherny - Leerink Partners - Analyst : Good morning and thanks for taking the questions. Maybe if I can just dive in a little bit on the orthodontic side a little further. Obviously, the byte roll-off continues. But as you go through that process, can you give us a little more sense on what you're hearing from your customer base, kind of how the SureSmile pitch has gone beyond here. And I'm sorry if I missed this, Simon, but any differences in your view on the eventual potential expansion beyond the current GP market?

Question: Michael Cherny - Leerink Partners - Analyst : Perfect. That's it for me now. Thank you.

Question: David Saxon - Needham & Company - Analyst : Yes, great. Good morning. Hopefully, you can hear me okay. So, maybe I'll start on CTS. So, the mix there was interesting to see. So, in equipment, growth obviously accelerated. I wanted to ask how much of that was driven by the comp versus any improvement in kind of underlying demand? And then on the CAD/CAM side, what was the impact of dealer inventory? And what are you seeing in iOS price and volumes?

Question: David Saxon - Needham & Company - Analyst : Yes. I mean I think that was about it, but my second question, maybe I'll ask on implants. So the US -- on the US side, it looks like it was down in the quarter. I guess, are you seeing any progress on that front? And then premium grew nominally. I think you said in the script. Any color around what it did in the US specifically. Thanks so much for taking my questions.

Question: Jonathan Block - Stifel, Nicolaus & Company, Incorporated - Analyst : Great. Thanks and good morning. Simon, maybe I'll just try to wrap up some questions in one. If you can maybe provide a bit more color just on current trends. Simply put, there was really big 1Q upside but no change to the full year guidance. And I get it, there's certainly a ton of moving parts which you touched on a bit. But is it just when we look back, it was sort of a good amount of conservatism to the 1Q guide. Or is there anything to call out that you're seeing as you look forward by product line or by region? And then I'll ask the follow-up.

Question: Jonathan Block - Stifel, Nicolaus & Company, Incorporated - Analyst : Got it. That was great. That was very helpful. And I don't think anyone are used with being prudent. I think just to shift gears for the second question, SureSmile was down. I think the words were slightly year-over-year and again, there's still that drag from the DSO customer. But just to push you a bit like when you hit the gas in ortho and you feel like the software is where you want it to be, what's your strategy on how to compete or how to win? And I just asked that because when I look at that landscape, you've got a player from China that's been very aggressive on price. You have another player that's able to leverage their wires and brackets franchise and then you have sort of the big incumbent, if you would. So maybe just talk to us a little bit on where you see the opportunity to go into a market like that and compete and win again when the software is where you want it to be? Thank you.

Question: Jeffrey Johnson - Robert W. Baird & Co. Incorporated - Analyst : Thank you. Good morning. Simon. I think we're all learning here through this earnings season on the questions to ask about tariffs and all that. So, maybe if I could ask just a couple more clarify, and I don't want to beat a dead horse here. But the $5 million annualized as you're talking about the $0.10 EPS impact as I do the math, it seems like it's about $25 million that is layering in this year to get down to that $0.10. And so one, should we expect that $25 million this year to go up to the $50 million annualized next year? Or do you think you can mitigate some of that into next year? Number one. Number two, does that $50 million annualized figure that you gave, does that assume the current 10% tariff outside of China or the kind of Liberation Day tariff rates that were higher in some of the European markets? And then the third part, just on tariffs is, do you have much exposure of products made in the US sold in China or China made products sold in the US vice versa? Just -- or is most of it Europe-based? Thank you.

Question: Jeffrey Johnson - Robert W. Baird & Co. Incorporated - Analyst : All right. That's helpful. Thank you. And then just a cash flow question, if I could. I know you don't guide to cash flow. But CapEx has been up kind of in that upper $150 million to $180 million to $200 million over million over the last couple of years, free cash flow

Question: Jeffrey Johnson - Robert W. Baird & Co. Incorporated - Analyst : Fair enough. Thank you.

Question: Jason Bednar - Piper Sandler & Co - Analyst : Good morning, everyone. I want to follow up first on Jon Block's first question just to see if we can put an even finer point on the US market. Simon, you mentioned some -- maybe some more cautious commentary on US dentist sentiment from your quarterly survey. I'm trying to process that in the context, I guess, of what you're seeing real-time at the patient level and also at the doctor level. Are you observing any patient reticence in moving forward on treatment, particularly in areas like ortho implants. And then are doctors putting a pause, even a temporary pause on equipment purchase decisions? Or do you think your survey is just an indicator of mood and concern rather than anything that's yet materializing in the end market? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 08, 2025 / 12:30PM, XRAY.OQ - Q1 2025 DENTSPLY SIRONA Inc Earnings Call

Question: Jason Bednar - Piper Sandler & Co - Analyst : Okay. All right, that's helpful. And maybe over to another important market for you. It's really good to see that Germany has been performing better, some durability on the growth. As we think about comps in that market in particular, I think you have maybe one or two, maybe three more quarters of really favorable comps, but I think it's just maybe a quarter or two. How do you think that market performs once we anniversary those easier comps? Do you think that durability you've seen in the last few quarters, does that sustain as we exit this year and look beyond?

Question: Brandon Vazquez - William Blair & Company L.L.C - Analyst : Hi everyone. Thanks for taking the question and squeezing me in here. Simon, maybe one for you first. When you look at DS Core, it started to get a pretty good scale here and a lot of followers -- lot of subscribers, I mean, can you talk about other than the total number of people on there? What are some of the key operating metrics that you guys are looking at, either from accounts that are on there when you compare it to the accounts not on DS Core? What gets you excited internally when you look at the metrics under the DS Core users?

Question: Brandon Vazquez - William Blair & Company L.L.C - Analyst : Okay. And Simon, maybe as a follow-up, you -- I've always appreciated that you guys take very measured and data-driven approaches when you're kind of making commercial changes here. You're once again talking about doing some surveys to better understand what areas you can improve upon. Talk to us about what segments of the business. You're still running these surveys in what segments of the business that you're most acutely focused on that still need some commercial tweaks you think to turn around. Thanks.

Question: Erin Wilson Wright - Morgan Stanley - Analyst : Great. thanks for squeezing me in. On margins, did you, I guess, accelerate any of the cost management kind of initiatives there? Were there any costs that were pushed out at all? I guess how should we be thinking about that quarterly progression or any sort of anomalies that we should be thinking about in terms of the second quarter? And then my second question, I'll just ask them both upfront, is it more bigger picture in terms of the guidance and the change in management today and the departure. I guess any sort of context there on the departure as well as who was involved in terms of formulating the guidance for dimmable you're taking full ownership of this guidance here? Thanks.