Smith & Nephew eyes revenue acceleration as quarterly sales beat view
Smith & Nephew PLC on Monday said it ended 2025 with a better-than-expected fourth quarter with all three divisions delivering growth, led by Orthopaedics.
S&N shares were down 5.5% to 1,296.50 pence in London on Monday. The wider FTSE 100 index was down 1.0%.
The Watford, England-based medical technology company reported pretax profit of $779 million in 2025, up 56% from $498 million in 2024, with operating profit up 20% to $794 million from $657 million.
Basic earnings per share jumped 53% to 72.1 US cents from 47.2 cents.
Revenue increased 6.1% to $6.16 billion from $5.81 billion, or by 5.3% on an underlying basis, ahead of company-compiled market consensus of $6.14 billion.
This included underlying growth of 6.2% in the fourth quarter of 2025 to $1.70 billion from $1.57 billion the year prior, ahead of consensus of $1.67 billion.
‘During the year, newer products drove strong broad-based performance, with underlying revenue growth above 5% for all three business units, and we look forward to a strong cadence of further new product introductions in 2026,’ said Chief Executive Deepak Nath.
Nath pointed out the results mark the completion of S&N’s ’12-point plan’ aimed at restoring performance in Orthopaedics and accelerating Sports Medicine and Advanced Wound Management.
In the fourth quarter, S&N said Orthopaedics delivered underlying revenue growth of 7.9%, and reported growth of 9.8%, its strongest quarter of revenue growth for more than two years.
Sports Medicine achieved underlying revenue growth of 7.3%, and reported growth of 9.5%, despite continuing China headwinds.
Advanced Wound Management had underlying revenue growth of 2.8%, and reported growth of 5.3%. S&N said this reflected a ‘strong comparative period and weakness in skin substitutes ahead of reimbursement changes in 2026’.
For 2026, S&N said it is looking to build on this momentum, targeting further progress in revenue, trading profit, and return on invested capital, together with sustained strong cash generation.
Underlying revenue growth is expected to accelerate to around 6% in 2026, with trading profit growth on an organic basis forecast to be around 8% from $1.21 billion in 2025.
Free cash flow is expected to be around $800 million, down from $840 million in 2025.
S&N raised its annual dividend by 4.3% to 39.1 US cents per share from 37.5 cents. It will pay a final dividend of 24.1 cents, up from 23.1 cents a year before.
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