-- Net sales of $7.4 billion, an increase of 10.7% -- Net income of $239 million, a decrease of 25.8% -- Adjusted EBITDA1 of $776 million, a decrease of 10.6% -- Raising full year 2026 Organic Sales2 guidance range to 8.5% to 9.5%
NORTHFIELD, Ill., May 06, 2026 (GLOBE NEWSWIRE) -- Medline Inc. ("Medline" or the "Company") (Nasdaq: MDLN), the largest provider of medical-surgical ("med-surg") products and supply chain solutions serving all points of care(3) , today reported its operating results for the three months ended March 28, 2026.
"We started 2026 with strong momentum--growing with our existing customers, executing implementations at scale and winning new customers, " said Jim Boyle, chief executive officer of Medline. "This performance gives us confidence to raise our full year Organic Sales guidance while continuing disciplined investments in our people, infrastructure and capabilities to support our strong customer demand and position Medline for sustained growth."
First Quarter 2026 Results
First quarter 2026 net sales increased 10.7% to $7.4 billion, compared to $6.6 billion in the first quarter 2025, with Organic Sales(1) increasing 10.1%. This was primarily driven by implementation of new customer signings from 2025 and existing customer growth.
First quarter 2026 net income decreased 25.8% to $239 million, compared to $322 million in the first quarter 2025, primarily driven by higher costs of goods sold including the impact of tariffs, higher operating expenses to support new customer growth and an employee bonus related to the Company's IPO. This was partially offset by higher net sales and lower interest expense.
First quarter 2026 Adjusted EBITDA(1) decreased 10.6% to $776 million, compared to $868 million in the first quarter 2025, primarily driven by higher costs of goods sold including the impact of tariffs and higher operating expenses to support new customer growth, partially offset by higher net sales.
Diluted earnings per share and Adjusted Diluted EPS(1) were $0.16 and $0.33, respectively.
Net cash provided by operating activities in the first quarter 2026 was $412 million, driven by net income, excluding the impact of non-cash items, partially offset by changes in working capital primarily due to increased trade accounts receivable related to sales growth and increased inventories.
Free Cash Flow(1) in the first quarter 2026 was $316 million, driven by net cash provided by operating activities, partially offset by capital expenditures, primarily related to continued enhancements and automation in the Company's distribution centers and investments in its kitting manufacturing facilities.
2026 Guidance
The Company is increasing its full year 2026 outlook for Organic Sales(2) growth to 8.5% to 9.5%, compared to its previous outlook of 8% to 9%, and is maintaining its Adjusted EBITDA(2) outlook of $3.5 to $3.6 billion.
Webcast and Conference Call Instructions
The Company will host a live conference call and question and answer session with investors and analysts on May 6, 2026, at 8:30 a.m. CT / 9:30 a.m. ET to discuss its first quarter 2026 earnings results. The webcast can be accessed through Medline's Investor Relations website at ir.medline.com. A replay of the call will be available following the event through the same website.
End Notes and Use of Non-GAAP Financial Measures
Certain amounts and percentages presented in this press release have a rounding element. As a result, the sum of the components may not equal the totals due to rounding.
(1) Organic Sales, Adjusted EBITDA, Adjusted EBITDA Margin,
Adjusted Net Income, Adjusted Diluted EPS, Free Cash
Flow, and Net Leverage are non-GAAP financial measures.
See discussion of these measures and reconciliations
to GAAP at the end of this press release for more
information.
(2) Guidance for Adjusted EBITDA and Organic Sales is
provided on a non-GAAP basis only because certain
information necessary to calculate the most comparable
GAAP measure is unavailable due to the uncertainty
and inherent difficulty of predicting the occurrence
and the future financial statement impact of such
items impacting comparability, including, but not
limited to, inventory-related adjustments, stock-based
compensation, litigation (gains) charges, net, transaction-related
costs, the impact of currency, and other non-core
(gains) charges, among other items. Therefore, as
a result of the uncertainty and variability of the
nature and amount of future adjustments, which could
be significant, the Company is unable to provide a
reconciliation of these measures with reasonable certainty
and without unreasonable effort.
(3) Based on our 2025 net sales relative to the publicly
reported net sales of med-surg products by companies
that are both med-surg manufacturers and distributors.
Forward Looking Statements
This press release contains forward-looking statements. Forward-looking statements include all statements that are not historical facts. Words such as "anticipate," "assume," "believe" "contemplate," "continue," "could," "estimate," "expect," "foreseeable," "intend," "may," "plan," "potentially," "predict," "project," "seek," "should," "will," or "would, " or similar conditional or future expressions are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements related to the Company's industry, business strategy, costs, and cost savings, goals and expectations, market position, future operations, margins, profitability, annual guidance, and other financial and operating information. The forward-looking statements are based on management's current expectations and are subject to various risks, uncertainties, and changes in circumstances, many of which are beyond the Company's control, that could cause actual results to differ materially.
Factors that may cause actual results to differ from expected results include, but are not limited to inherent risks in the Company's global operations; the Company's ability to derive fully the anticipated benefits from its existing or future acquisitions, joint ventures, investments, dispositions, or other strategic transactions; consolidation in the healthcare industry; competition and accelerating pricing pressure and changes in technology; changes to the U.S. and global healthcare environments; increases in shipping costs or service issues with the Company's third-party shippers; significant challenges or delays in the Company's sourcing of new products and technologies; the Company's concentration in and dependence on certain healthcare provider customers and Group Purchasing Organizations; the Company's dependence on the proper functioning of its critical facilities and distribution networks; quality problems, recalls and product liability claims; the Company's failure to establish and maintain Prime Vendor relationships; increased pressure to maintain or decrease the price of the Company's goods and services; failure by or loss of a third-party manufacturer or supplier or other manufacturing or supply-related impacts; the Company's reliance on the proper function, security, and availability of its information technology systems and data, as well as those of third parties throughout its global supply chain and the impact of a breach, cyber-attack, or other disruption to these systems or data; the Company's ability to comply with extensive and complex laws and governmental regulations and the cost of any adverse regulatory action; the Company's use or its third-party service providers' or business partners' use of artificial intelligence, automated decision-making and machine learning technologies and the evolving regulatory framework in this area; the Company's ability to comply with laws and regulations relating to reimbursement of healthcare goods and services; uncertain global and domestic macro-economic and political conditions, including as a result of global geopolitical conflicts and tensions, such as the ongoing conflicts in Ukraine and the Middle East; the Company's substantial indebtedness and the significant operating and financial restrictions on the Company's subsidiaries imposed by the Company's debt agreements; the dual class structure of the Company's common stock; the volatility of the market price of the Company's Class A common stock; and other factors.
The Company disclaims any intent or obligation to update, revise, or withdraw any forward-looking statement in this press release, except as required by applicable law or regulation.
The Company uses its investor relations website at ir.medline.com, press releases, public conference calls and webcasts, and social media as routine channels of distribution to communicate important, and often material, information about Medline to investors and the public, including information about its financial performance and results, analyst and investor presentations, investor days, products, solutions, sustainability initiatives, and corporate governance practices. You are encouraged to follow these channels, in addition to our SEC filings, for timely information about the Company. The information on the Company's websites is not part of this press release and is not incorporated by reference into any filings the Company makes with the SEC.
Non-GAAP Financial Measures
The non-GAAP financial measures provided in this press release should be viewed in addition to, and not as an alternative for, results prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").
To supplement the financial information provided, the Company has presented Organic Sales, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Diluted EPS, Free Cash Flow, and Net Leverage, which are considered non-GAAP financial measures. The non-GAAP financial measures presented may differ from similarly titled non-GAAP financial measures presented by other companies, and other companies may not define these non-GAAP financial measures in the same way. These measures are not substitutes for their comparable GAAP financial measures, such as net income/(loss), net income margin, diluted earnings per share, net cash from operating activities, net sales, or other measures prescribed by GAAP, and there are limitations to using non-GAAP financial measures.
Management uses these non-GAAP financial measures to assist in comparing the Company's performance on a consistent basis for purposes of business decision making by removing the impact of certain items that management believes do not directly reflect the Company's ongoing operating performance. The Company believes Organic Sales, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Diluted EPS provide important comparability of ongoing operating performance, allowing investors and management to assess the Company's operating performance on a consistent basis. The Company believes Free Cash Flow and Net Leverage provide a measure of the Company's core operating performance, the cash-generating capabilities of the Company's business operations, and are factors used in determining the Company's borrowing capacity and the amount of cash available for debt repayments, acquisitions, and other corporate purposes.
Management believes that presenting the Company's non-GAAP financial measures is useful to investors because it (i) provides investors with meaningful supplemental information regarding financial performance by excluding certain items that we do not consider indicative of our ongoing operating performance, (ii) permits investors to view performance using the same tools that management uses to budget, make operating and strategic decisions, and evaluate historical performance, and (iii) otherwise provides supplemental information that may be useful to investors in evaluating the Company's results. The Company believes that the presentation of these non-GAAP financial measures, when considered together with the corresponding GAAP financial measures and the reconciliations to those measures, provides investors with additional understanding of the factors and trends affecting the Company's business than could be obtained absent these disclosures.
Definitions
Organic Sales is defined as net sales excluding, when they occur, the impact of acquisitions, divestitures, and changes in foreign exchange rates from the net sales changes. The changes in foreign currency exchange rates from the net sales changes are calculated by translating current period GAAP results at the prior period foreign currency exchange rates and comparing these amounts to the current period GAAP results at the current period foreign currency exchange rates.
Adjusted EBITDA is defined as net income (loss) adjusted for (i) interest expense, net, (ii) provision for income taxes, (iii) depreciation and amortization, (iv) inventory-related adjustments, (v) stock-based compensation, (vi) litigation (gains) charges, net, (vii) transaction-related costs, and (viii) other non-core (gains) charges. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by net sales.
Adjusted Net Income is defined as net income (loss) adjusted for (i) intangible asset amortization, (ii) inventory-related adjustments, (iii) stock-based compensation, (iv) litigation (gains) charges, net, (v) transaction-related costs, (vi) other non-core (gains) charges, and (vii) tax impacts related to non-GAAP adjustments, noncontrolling interests conversion, and retained tax receivable agreement ("TRA") benefits. Adjusted Diluted EPS is defined as Adjusted Net Income divided by adjusted weighted-average number of common stock, diluted. The adjusted weighted shares calculation assumes the impact of certain antidilutive securities that were excluded from the U.S. GAAP diluted earnings per share.
Free Cash Flow is defined as net cash provided by/(used for) operating activities less net capital expenditures. The use of this non-GAAP measure does not imply or represent the residual cash flow for discretionary expenditures since the Company has certain non-discretionary obligations such as debt service that are not deducted from the measure.
Net Leverage is defined as net debt (total debt less cash, cash equivalents and short-term investments) divided by Adjusted EBITDA.
Medline
Medline is the largest provider of medical-surgical products and supply chain solutions serving all points of care. Through its unique offering of world-class products, supply chain resilience and clinical practice expertise, Medline delivers improved clinical, financial and operational outcomes. Headquartered in Northfield, Illinois, the Company employs more than 45,000 people worldwide and operates in more than 100 countries. To learn more about how Medline makes healthcare run better, visit www.medline.com.
Investor Relations:
Karen King
Global Head of Investor Relations
Patrick Flaherty
Director, Investor Relations
(847) 247-7222
IR@medline.com
Media Relations:
Ben Fox
Vice President, Corporate Communications
(224) 327-9999
media@medline.com
Financial Tables
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three months ended
(in millions,
except per share March 28, March 29,
amounts) 2026 2025 $ Change % Change
----------- ----------- ---------- ----------
Net sales $7,352 $6,644 $ 708 10.7%
Cost of goods sold 5,511 4,820 691 14.3%
----- --- ----- --- ----- -----
Gross profit 1,841 1,824 17 0.9%
Gross margin % 25.0% 27.5%
Operating expense
Selling, general
and
administrative
expenses 1,228 1,070 158 14.8%
Amortization of
intangible
assets 176 175 1 0.6%
Other operating
expenses 15 8 7 87.5%
----- --- ----- --- ----- -----
Total operating
expense 1,419 1,253 166 13.2%
Operating income 422 571 (149) (26.1)%
Operating margin
% 5.7% 8.6%
Other expense
Interest
expense, net (136) (210) 74 (35.2)%
Other income,
net 1 -- 1 NM (1)
Foreign exchange
gain (loss),
net 4 (23) 27 NM (1)
----- --- ----- ----- ----- ---
Total other
expense (131) (233) 102 (43.8)%
Income before
income taxes 291 338 (47) (13.9)%
Provision for income
taxes 52 16 36 NM (1)
Net income 239 322 (83) (25.8)%
Net income % 3.3% 4.8%
Net income
attributable to
noncontrolling
interests 110 -- 110 NM (1)
----- --- ----- --- ----- ----- ---
Net income
attributable to
Medline Inc. $ 129 $ 322 $ (193) (59.9)%
Earnings per share
attributable to
Medline Inc.
Basic $ 0.16 N/A
Diluted $ 0.16 N/A
Weighted-average
number of Class A
common stock
outstanding
Basic 819 N/A
Diluted 825 N/A
(1) Not Meaningful
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, except per As of March 28, 2026
share amounts) (Unaudited) As of December 31, 2025
-------------------- -----------------------
ASSETS
Current assets
Cash and cash
equivalents $ 2,236 $ 1,939
Trade accounts
receivable, net of
allowance for credit
losses of $148 and
$152 as of March 28,
2026 and December 31,
2025, respectively 3,674 3,533
Inventories 4,807 4,769
Other current assets 463 438
----- ------------- --- --------------
Total current
assets 11,180 10,679
Property, plant, and
equipment, net 4,758 4,778
Other non-current assets
Goodwill 8,076 8,079
Intangible assets, net 13,717 13,893
Deferred tax assets 837 583
Other long-term assets 446 472
----- ------------- --- --------------
Total other
non-current
assets 23,076 23,027
----- ------------- --- --------------
Total assets $ 39,014 $ 38,484
===== ============= === ==============
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities
Current portion of
long-term borrowings
and other short-term
borrowings $ 77 $ 77
Accounts payable 932 961
Accrued expenses and
other current
liabilities 1,527 1,452
Total current
liabilities 2,536 2,490
Non-current liabilities
Long-term borrowings,
less current portion 12,495 12,484
Tax receivable
agreement liability 4,009 3,542
Other long-term
liabilities 625 682
----- ------------- --- --------------
Total non-current
liabilities 17,129 16,708
----- ------------- --- --------------
Total liabilities $ 19,665 $ 19,198
----- ------------- --- --------------
Commitments and
contingencies
Stockholders' equity
Class A common stock,
par value $0.0001 per
share; 50,000 shares
authorized; 846 and
812 shares issued and
outstanding as of
March 28, 2026 and
December 31, 2025,
respectively -- --
Class B common stock,
par value $0.0001 per
share; 50,000 shares
authorized; 468 and
502 shares issued and
outstanding as of
March 28, 2026 and
December 31, 2025,
respectively -- --
Preferred stock, par
value $0.0001; 5,000
shares authorized; no
shares issued and
outstanding -- --
Additional paid-in
capital 11,132 10,717
Retained earnings
(accumulated deficit) 122 (7)
Accumulated other
comprehensive income 18 27
----- ------------- --- --------------
Total Medline Inc.
stockholders'
equity 11,272 10,737
Noncontrolling
interests 8,077 8,549
----- ------------- --- --------------
Total stockholders'
equity 19,349 19,286
----- ------------- --- --------------
Total liabilities and
stockholders' equity $ 39,014 $ 38,484
===== ============= === ==============
Condensed Consolidated Cash Flow Highlights
(unaudited)
Three months ended
----------------------------------------------------
March 28, March 29,
($ millions) 2026 2025 $ Change % Change
------------- ------------- ---------- ----------
Net cash
provided by
operating
activities $ 412 $ 682 $ (270) (39.6)%
Net cash used
in investing
activities (96) (92) (4) 4.3%
Net cash used
in financing
activities (13) (9) (4) 44.4%
Effect of
exchange rate
changes (7) 9 (16) NM (1)
--- ---- --- ---- ----- ----- ---
Net change in
cash, cash
equivalents
and
restricted
cash $ 296 $ 590 $ (294) (49.8)%
=== ==== === ==== ===== =====
(1) Not Meaningful
Segment Net Sales and Adjusted EBITDA Margin
(unaudited)
Three months ended
------------------------------------------------------
($ millions,
except
percentages) March 28, 2026 March 29, 2025 $ Change % Change
-------------- -------------- ---------- ----------
Medline Brand
segment
Net sales $ 3,465 $ 3,264 $ 201 6.2%
Adjusted
EBITDA 765 830 (65) (7.8)%
Adjusted
EBITDA
Margin 22.1% 25.4%
Supply Chain
Solutions
segment
Net sales $ 3,887 $ 3,380 $ 507 15.0%
Adjusted
EBITDA 187 182 5 2.7%
Adjusted
EBITDA
Margin 4.8% 5.4%
Corporate &
Other(1) $ (176) $ (144) $ (32) 22.2%
(1) The organizational structure includes Corporate
& Other which consists of expenses related to centralized
corporate functions, such as finance, information
technology, legal, human resources, and internal audit.
Reconciliation of Net Sales to Organic Sales
(unaudited)
Three months ended
-------------------------
($ millions, except percentages) Amount Percentage
----------- ------------
Net sales for period ended March 28, 2026 $ 7,352
Net sales for period ended March 29, 2025 6,644
-------
Net sales growth 708 10.7%
Impact from changes in foreign exchange rates 34 0.6%
------- -------
Organic Sales $ 674 10.1%
======= =======
Reconciliation of Net Income to Adjusted EBITDA and
Net Leverage
(unaudited)
Trailing Twelve
months ended Three months ended
--------------- --------------------------------------------------
($ millions, except March 28, March 29,
percentages) March 28, 2026 2026 2025 $ Change % Change
--------------- ----------- ----------- ------------ ----------
Net income $ 1,074 $ 239 $ 322 $ (83) (25.8)%
Interest expense, net 738 136 210 (74) (35.2)%
Provision for income
taxes 127 52 16 36 NM (5)
Depreciation and
amortization 1,018 254 247 7 2.8%
Inventory-related
adjustments(1) 91 29 21 8 38.1%
Stock-based
compensation
expense 80 23 22 1 4.5%
Litigation charges
(gains), net(2) 1 -- (34) 34 NM (5)
Transaction-related
costs(3) 81 35 12 23 NM (5)
Other non-core
charges(4) 165 8 52 (44) (84.6)%
------ ------ ---- ---- ---- ---- ---- -----
Adjusted EBITDA $ 3,375 $ 776 $ 868 $ (92) (10.6)%
------ ------ ---- ---- ---- ----
Net income margin 3.7% 3.3% 4.8%
------ ----- ---- --- ---- ---
Adjusted EBITDA Margin 11.6% 10.6% 13.1%
------ ----- ---- --- ---- ---
Total debt $12,755
Less: Cash and cash
equivalents 2,236
------ ------
Net debt $10,519
------ ------
Net Leverage 3.1
------ ------
(1) Represents inventory adjustment associated with
non-cash last-in, first-out reserves.
(2) For the three months ended March 29, 2025, represents
a settlement adjustment of $(8) million related to
the ethylene oxide litigation, $(30) million related
to settlement of an intellectual property dispute,
and $4 million related to other legal settlements.
(3) For the three months ended March 28, 2026 and
March 29, 2025, respectively, includes $27 million
and $4 million of expenses related to our IPO and
subsequent offerings, consisting of legal, accounting,
and advisory fees, as well as one-time employee bonuses,
which are subject to an ongoing service requirement,
and $8 million and $8 million of acquisition and integration-related
costs and adjustments.
(4) For the three months ended March 28, 2026 and
March 29, 2025, respectively, includes $9 million
and $5 million of other project costs; $(4) million
and $22 million of realized and unrealized foreign
exchange and investment (gains) losses; and $(4) million
and $24 million credit (recoveries) loss expense related
to certain customer receivables. The three months
ended March 28, 2026 also includes $8 million of losses
on disposal of assets and exits.
(5) Not Meaningful.
Reconciliation of Net Income to Adjusted Net Income
and Adjusted Diluted EPS
(unaudited)
Three months ended
----------------------
(in millions, except number of shares and per share
amounts) March 28, 2026
----------------------
Net income $ 239
Intangible asset amortization 176
Inventory-related adjustments(1) 29
Stock-based compensation expense 23
Transaction-related costs(2) 35
Other non-core charges(3) 8
Tax effect on non-GAAP adjustments(4) (65)
Tax provision on conversion of noncontrolling
interests(5) (19)
Tax impact of retained TRA benefits(6) 7
---------------
Adjusted Net Income $ 433
Weighted-average number of Class A common stock
outstanding (Diluted) 824,836,037
Exchange of Class B common stock(7) 492,676,526
Adjusted weighted-average common stock outstanding
(Diluted) 1,317,512,563
Diluted earnings per share $ 0.16
Adjusted Diluted EPS $ 0.33
(1) Represents inventory adjustment associated with
non-cash last-in, first-out reserves.
(2) For the three months ended March 28, 2026 and
March 29, 2025, respectively, includes $27 million
and $4 million of expenses related to our IPO and
subsequent offerings, consisting of legal, accounting,
and advisory fees, as well as one-time employee bonuses,
which are subject to an ongoing service requirement,
and $8 million and $8 million of acquisition and integration-related
costs and adjustments.
(3) For the three months ended March 28, 2026 and
March 29, 2025, respectively, includes $9 million
and $5 million of other project costs; $(4) million
and $22 million of realized and unrealized foreign
exchange and investment (gains) losses; and $(4) million
and $24 million credit (recoveries) loss expense related
to certain customer receivables. The three months
ended March 28, 2026 also includes $8 million of losses
on disposal of assets and exits.
(4) Non-GAAP adjustments are tax effected using an
estimated effective tax rate of 25%. Stock-based compensation
expense related to partnership units is not tax deductible
and, therefore, not tax effected.
(5) Represents incremental tax provision assuming
100% ownership by Medline Inc., using an estimated
effective tax rate of 25%, applied to the income before
income taxes on our unaudited Condensed Consolidated
Statements of Income.
(6) Represents the 10% benefit that we retain for
the shared tax benefits related to the TRA.
(7) Assumes the full exchange of the units held by
noncontrolling interests for shares of Class A common
stock.
Reconciliation of Net Cash Provided by Operating Activities
to Free Cash Flow
(unaudited)
Three months ended
-----------------------------------------------------
March 28,
($ millions) 2026 March 29, 2025 $ Change % Change
Net cash
provided by
operating
activities $ 412 $ 682 $ (270) (39.6)%
Net capital
expenditures (96) (98) 2 (2.0)%
--- ---- --- ----- ----- ------
Free Cash Flow $ 316 $ 584 $ (268) (45.9)%
=== ==== === ===== ===== ======
(END) Dow Jones Newswires
May 06, 2026 07:30 ET (11:30 GMT)
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