Hello everyone and welcome to the Enovis Corporation Q1 2025 Results Call. My name is Ezra and I will be your coordinator today. If you would like to ask a question, please press star followed by one on your telephone keypad now. If you change your mind, please press star followed by two. I will now hand you over to your host, Kyle Rose, Vice President of Investor Relations, to begin. Please go ahead. Thank you, Ezra. Good morning everyone and thank you for joining us today for our first quarter 2025 results conference call. I'm Kyle Rose, Vice President of Investor Relations. Joining me on the call today are Matt Trerotola, Chair and Chief Executive Officer, and Ben Berry, Chief Financial Officer. Our earnings release was issued earlier this morning and is available in the investor section of our website at enovis.com. We will be using a slide presentation in today's call, which can also be found on our website. Both the audio and the slide presentation will be archived on the website later today. During this call, we'll be making some forward-looking statements about our beliefs and estimates regarding future events and results. These forward-looking statements are subject to risks and uncertainties, including those set forth in the safe harbor language in today's earnings release and in our filings with the SEC. Actual results might differ materially from any forward-looking statements that we make today. The forward-looking statements speak only as of today, and we do not assume any obligation or intend to update them except as required by law. For further details regarding any non-GAAP financial measures referenced during the call today, the accompanying reconciliation information relating to those measures can be found in our earnings press release and in the appendix of today's slide presentation. With that, let me turn it over to Matt, who will begin on slide three. Thanks, Kyle. Hello everyone and thanks for joining us this morning. Let's start on slide three and talk about some of the quarter's highlights. We had a strong start to the year and I'm excited about the future of Enovis. In the first quarter, we delivered reported growth of 8% and 11% on a comparable basis. When we look through the extra days and currency to the effective growth rate, it's right in line with our high single-digit strategic goals. Our teams have made tremendous progress using new products to drive share gain, and we have a clear line of sight to a multi-year cadence of meaningful NPI. We expanded our adjusted EBITDA margins by 160 basis points, reflecting the mixed impact of recon, stable pricing trends, and EGX-driven productivity improvements. In recon, on slide four, we delivered comparable growth of 13%, which includes some tailwinds from additional selling days. U.S. recon grew 11%, including 12% growth in U.S. extremities and 10% growth in hips and knees. We're once again consistently growing well above market rates in the U.S., as our teams are energized, focused on growth, and have great innovation supporting their surge in conversion efforts. Outside the U.S., we grew 14% in a resilient market, showing the power of the global position that we've built. We exited the first quarter with strong momentum and excitement from recent and upcoming new product launches, including the augmented reverse glenoid system in shoulders, the Nebula stem and surgical impactor in hip, and the next generation of Arvis hardware and software. In PNR, on slide five, our 8% comparable growth reflects a stable market environment, disciplined execution, and the benefit of additional selling days. Overall, this business is performing in line with our strategic plan and will benefit from the Manafuse LIPUS technology launch in recovery sciences and several key new bracing products in the coming quarters. Adjusted EBITDA margins in PNR improved 50 basis points year over year as we continue to use EGX tools to drive consistent productivity improvements and proactively shape the portfolio for profitable growth. Most of our tariff exposure is in PNR, and the team are doing a fantastic job driving initiatives to minimize the net impact. Ben will share a bit more on this. I wish we did not have to deal with this, but our EGX tools and post-COVID inflation experience have us well prepared to get through this without stalling our growth or changing the longer-term upward arc of our margins. Before I pass it to Ben, I'd like to make a few personal comments. This is my 40th earnings call as the CEO of Colfax and now Enovis. Across that period, our teams around the world have relentlessly worked to build a great company that creates better, better futures for our customers, great opportunities for our employees, and substantial value for our shareholders. I'm incredibly thankful to our team and proud of what we've achieved, and I truly appreciate the 10-year dialogue that I've had with many of you about our plans, progress, and opportunities ahead. We have a strong foundation, an incredibly talented team, great operational and strategic momentum, and I'm passing the baton to a fantastic leader who I'm confident will lead the company to compounding value creation in the years to come. I'm committed to making sure that this transition is smooth, even with the dynamic tariff backdrop. Now I'll let Ben take you through the P&L details. Ben. Thanks, Matt. Hello everyone. I'll begin on slide six. We are pleased to report first quarter sales of $559 million, up 8% versus the prior year and 10% on a constant currency basis. The quarter included approximately 120 basis points of negative currency headwinds and roughly 350 basis point benefit from additional selling days. We were encouraged with the continued growth acceleration in our recon business across anatomies as we've seen positive early results from our recent product launches. We are confident that our channel integration efforts are fully behind us as we exit the first quarter. Overall, our recon business grew 13% with double-digit growth globally across our main segments in both hip and knee and extremities. Our growth in PNR was strong, growing at 8%, mid-single-digit growth when adjusted for selling days. We had positive business mix in the first quarter, leading to adjusted gross margins of 61.7%. This is an increase of 300 basis points year- over- year. The growth was driven by favorable segment and product mix and momentum from EGX initiatives across our manufacturing operations and supply chain. Despite ongoing investments in key R&D initiatives and medical education programs, our first quarter adjusted EBITDA grew 19%, delivering a margin of 17.7%, up 160 basis points versus the same quarter last year. First quarter effective tax rate was 23%, approximately 70 basis points higher than last year. Interest expense was $9 million for the quarter versus $20 million in 2024. Overall, we posted adjusted earnings per share of $0.81, an increase of 62% versus prior year. Turning to slide seven, I will provide updated guidance, which includes adjustments for currency movements and the current tariff situation. For revenues, we reiterate our 2025 organic constant currency revenue growth of 6%-6.5% year over year, which includes high single-digit growth in recon and low single-digit growth in PNR. Based on the most recent rates, primarily due to the strengthening euro, we expect our foreign currency impact to be flat versus prior year. This compares to negative currency headwinds of 1%-2% in our previously contemplated guidance. Because of this, we are increasing our revenue range by $30 million to $2.22 billion-$2.25 billion, which we expect to phase in equally over the coming quarters. On margins, we are lowering our adjusted EBITDA range to $385 million-$395 million. This is a reduction of $20 million versus our prior guide and reflective of the incremental tariffs that we expect to impact profit in the second half of 2025. We are lowering the depreciation range by $5 million to $120 million-$125 million and also lowering our interest expense range by $4 million to $38 million-$42 million. No adjustments have been made to our tax rate or our share count outlook. Considering these changes, we are updating our adjusted earnings per share range to $2.95-$3.10, down $0.15 from our prior guidance. Lastly, we maintain our expectation for positive free cash flow in 2025. Let's turn to slide eight, where I will provide a more detailed view of the current global trade environment and the implications to our business. Based on the current announced rates shown on the slide, we expect $40 million of 2025 tariff exposure that we have clear plans to mitigate to $20 million. The impacts are well over 90% in our prevention and recovery business, so we will focus our commentary there. While the majority of our trade flows into the U.S. are from Mexico and fall within the USMCA exemption, we have several smaller portions that are subject to tariffs. China is less than 10% of our PNR cost of goods, but given the very high rates in place, it represents 75% of our tariff exposure. Fortunately, these are mostly class one products that are relatively easy to shift to other geographies. In fact, we have been working diligently for the last few years to build resilience in our supply chains and have active projects to shift the procurement or production of these goods to other parts of the world. We are accelerating these projects and expect to transition at least 50% of this exposure by the middle of 2026. We also see supply chain opportunities on the smaller exposures from other countries and have a great commercial and sourcing playbook that we use to recover all of the post-COVID inflation. Our plans to mitigate as much as possible of the 2025 impact are in flight, staffed, and even if current levels continue, we expect to exit the year on a path to recover a portion of the 2025 impact in 2026. The tariff situation remains very fluid. We are monitoring the events closely, and we will provide updates as appropriate as we gain further visibility into the outcomes as the situation evolves. To summarize on slide nine, we had an encouraging start to 2025 and continue to see solid momentum to start the second quarter. We are pleased with our improving business mix and are excited about the new product innovations that should continue to ramp over the course of 2025. The underlying fundamentals of the business are strong, and we are poised to manage the business responsibly through this dynamic environment and maintain momentum towards our strategic goals. Kyle. Great. Thanks, Ben. Before we begin the Q&A session, in an effort to accommodate everyone on the call, we ask the analysts to keep the questions to one question and one follow-up. You are welcome to rejoin the queue if we have time. Operator, please start the Q&A. Thank you very much. If you would like to ask a question, please press star followed by one on your telephone keypad now. When prepping to ask your question, please ensure your device is unmuted locally. If you change your mind, please press star followed by two. Our first question comes from Vic Chopra with Wells Fargo. Vic, your line is now open. Please go ahead. Hey, good morning and congrats on a nice start to the year. Two questions for me. The first one, you know, Matt or Ben, I guess you've laid out a number of mitigating actions in the slide deck. I'm just curious which of these you view as having the most significant potential to create durable supply availability over the long term. Then I had a quick follow-up, please. All right. Yeah, thanks. Thanks a lot, Vic. Yeah, as Ben mentioned, I think the best opportunity we have is to quickly move in the sourcing of products out of China. That is where most of our tariff exposure is coming from. We have already been working on that and brought it down over the past 12 months. We feel comfortable that there are a number of other countries. In some cases, the same suppliers can move the product to another country. In some cases, we have to resource. By working aggressively on those, we can move the number down that makes the amount that we need to work on other mechanisms like commercial actions and things. That becomes a smaller number. That is the sustainable way through this. Okay, got it. That's super helpful. Just one more question for me. In the deck, you noted 12%+ extremities growth in Q1. We'd just love to hear what you're seeing with the ARG launch and maybe just talk about general trends in the market overall. Thank you. Yeah, so first, ARG launch is going terrifically. Like any launch, we're taking it step by step, and we're just a handful of months into it, but it's going terrifically. You have seen even in Q4 and then here in Q1, you can see the impact there on our extremities growth. Our shoulder growth is now comfortably back above the market as we continue to have the great Ultimate product and now the ARG that we're bringing with that. That is going very well. As far as your question about markets more broadly, it was a good healthy start to the year. We talked about there was a good finish to last year. This year started out strong, actually, January and February were really healthy. March was a month that had a few more sort of vacations and shows and things. It was not as, I would say, not as hot as January and February, but the quarter as a whole was a good solid start to the year. We are seeing a good healthy April. In the U.S., we are expecting at least a normal year of growth here in the U.S., and outside the U.S., a good healthy start too. Thank you very much. Operator, next question. Our next question comes from Vijay Kumar with Evercore ISI. Your line is now open. Please go ahead. Hey, guys, thanks for taking my question. Matt, wishing you the best as you transition here. Maybe one on the US performance here. Bracing came in pretty strong, 10%. That's well above normalized trends. And when I look at the U.S. large joint performance, X days perhaps 7%, 8%-ish. Was that in line with your expectations? Maybe just talk about the U.S. performance, bracing better with recon in line or perhaps any timing element out there. Yeah, I'd say, Vijay, thanks for the comments. Certainly a healthy start in the U.S. market in bracing. We were happy with that. I think that was consistent with what I commented about the strong market environment that we saw in January and February. Often that flows over and helps bracing as well. We feel good about that start. The team did some great work last year driving clinic conversions that are helping get them off to a great start this year as well. There is some great NPI in that business. As we said on the slide, our spine products that we've been building out there grew double digits in the quarter. Some good things going on there. We're happy with that. On the recon side, our Q1 was fully in line with the expectations that we had. We've been talking consistently about quarter-by-quarter progression in that business. What we saw was consistent with that. Certainly, January and February suggested that it might have been even better. March kind of took back a little bit of that. When you step back on the whole quarter, we feel like it was a good, strong quarter for our U.S. surgical business. We're early days on the ARG launch. We just got our hip products into the market. We've got a number of enabling tech products that we got in Q1 and that are coming later in the year. There's plenty of reasons to believe that we can sustain and build on that U.S. surgical performance. Understood. Maybe Ben, one for you on gross margins, pretty strong Q1. You were up sequentially. Any one-timers here on the gross margins or is this a sustainable number? Yeah, Vijay, I think it's very much positive business mix that we're getting in both sides of the business. I think the new products that Matt outlined are really contributing well. Same on the having really strong extremities recovery on the recon side, seeing the benefit of the higher gross margins there. Definitely feel like we've continued to mix and shape the company towards higher gross margin performance year after year. Other than the fact that we'll have some headwinds in the second half of the year with the tariffs, as I outlined on the call. Overall, I think underlying performance and gross margin is positive, and I would expect that to continue. Thanks, guys. Our next question comes from Robbie Marcus with JP Morgan. Robbie, your line is now open. Please go ahead. Oh, great. Good morning, and thanks for taking the questions. Two for me. First, I wanted to ask on second quarter. It looks like first quarter was pretty much right in line with the street on an organic basis. How should we be thinking about the seasonally stronger second quarter within the guide, just given the integration last year made for some funky comps? Then I have a follow-up. Thanks. Yeah, thanks, Robbie. I think from our view, given that we had some tailwind from days in the first quarter, you'll see a slightly different pattern in terms of how the seasonal performance works quarter over quarter. It is very much in line with what we had outlined in our prior call with regards to our first half, second half splits in terms of our view on how we would expect the revenue to play out. Nothing's changed with regards to our outlook there. I think you have the information you need to kind of think how we're thinking about the second quarter. Great. Maybe on cash flow and financing, you're still calling for positive free cash flow. It was decently negative in the first quarter, and it looks like you hit the revolver for $70 million. Just maybe speak to the confidence and the progression of free cash flow through the year and where you expect to end the year on leverage. Thanks a lot. Yeah, seasonally, first quarter is always our lowest as we pay out bonuses and things like that in the first quarter. We're slightly ahead of our operating plans in terms of cash flow in the first quarter, and we see clear signs for us to continue to drive improvements over the course of the balance of the year. Still very confident in the guidance that we've put out there and feel like we continue to take ground on getting up the cash flow conversion curve that we've laid out. Very much a step forward this year as we see some reduction in some of the integration costs. This is the last year where we're still spending a little bit more heavily on the EUMDR. There's a clear line of sight to continue to improve free cash flow for the company. I would expect that to continue as we move into the second quarter and the balance of the year. Obviously, we've got some challenges with the tariffs coming our way. That'll put a little bit of a headwind in terms of our overarching operating plans that we had to start the year. As we said, we're going to mitigate as much as we can and still be in a position where we can deliver positive cash flow in the year. Where should we expect the year-end leverage to settle out? Yeah, I think we're still in the operating view that we'll be in the 3-3.5 range in terms of leverage as we exit the year. Thank you very much. Our next question comes from Caitlin Cronin with Canaccord Genuity. Caitlin, your line is now open. Please go ahead. Hey, guys, it's [Michaela] on for Caitlin. Thanks for taking the questions. Our first one, can you provide an update on the Arvis shoulder launch, how it's progressing so far, when you expect a broader rollout? Are you still expecting an OUS launch of the Arvis tech this year? Yeah, thanks for the question. The Arvis shoulder launch is going really well. We've specifically only put it in a certain number of surgeons' hands to make sure that we get some great feedback and sort of control the rate of the launch. The response from the surgeons that have gotten a chance to use it has been extremely positive. I would say the other effect that we probably underestimated is as we bring Arvis to local events around the country, we are finding that the amount of surgeons that want to come out to the local event and learn about AltiVate so that they can see Arvis is significant. We are excited about the response to the product as well as just the buzz and energy it's creating around our shoulder business as a whole and the growth acceleration there. We are feeling very good about that. Awesome. Thanks. Just one more. Can you speak a little bit to the cadence of other new product launches for this year and whether they're still aligned with your original expectations? Yeah, new product launches broadly, not just enabling tech? Yeah. Yeah. Yeah. We've got a great lineup of new product launches. Some of them launched late last year and are now just building this year. We've got others coming through this year. On the recon side, I didn't mention in my comments, but we're still making hay with our knee revision products, right? We brought some great products out now a year or so ago, but then added the Lima products. We've now got, in terms of the revision and the cones that we've got between what we launched and what came with Lima, we've really got the best revision sort of cones solution out there, we think. We're really happy with the momentum and revision in knee from those launches from a little while back. We've got the ARG from late last year that is ramping quarter- by- quarter here and really a real positive in shoulder. We just got into the market at the end of the quarter, our colored stem, the Nebula in hip and the hip impactor to go with that. Again, that's in a controlled launch now. It is going to be kind of quarter- by- quarter in terms of how that ramps. For each anatomy, something really good to be run with. The enabling tech, the guidance products or the guidance technologies and enabling tech of Arvis as well as our HAB 360 in knee and gap balancing for both of those products this year as well. On the recon side, a lot of great things going on. On the PNR side, some great things in terms of spine braces, Romo A still ramping, and the Manafuse product that's given us great runway in our recovery sciences bone stem business. Great. Thanks so much. Our next question comes from Dane Reinhardt with Baird. Dane, your line is now open. Please go ahead. Hey, good morning, guys. Thanks for taking the questions here. I just wanted to maybe double-click on kind of following up on Robbie's question regarding cash flow. First, can you just remind us how you're thinking about CapEx this year? I know the size of the company has kind of grown 50% just since the Mathys and Lima deals over the past few years. CapEx is also up almost 3x that amount or 3x the amount it was a few years ago. Wondering kind of what you're thinking about CapEx levels over the next few years. I know your free cash flow goal or conversion, I think, is 70%-80% over the long term. Can you just kind of remind us, do you have a timeline around that target? Yeah, thanks, Dane, for the question. Yeah, I think as the business has continued to evolve and we've brought in Lima and as we've continued to scale the foot and ankle business and as we're investing for growth, we've been putting in the necessary instrumentation to support that growth, which creates a little bit of elevated CapEx just as we're getting started in terms of driving some of the opportunities there to grow above the market. The second thing that's happening in CapEx is that we continue to invest to expand facilities and to get after some of the integration synergies that we'd identified as part of the Lima deal. We're in a little bit of an elevated phase of operational CapEx right now as we are putting in place the equipment that's necessary to get after some of the next phase of our synergies that will return to the bottom line. Overall, we feel like we're in probably a next one to two year of a little bit of elevated CapEx spend on the operational side, but that will get more efficient as we clear 2026. As we get the growth investments put out there, you'll see some efficiency in CapEx over time. It won't be overnight, but it will be, I'd say, steady over the course of the next several years. As we look at the integration spend levels, those will step down significantly. As we look at our European medical device regulation spend, this is the last heavy year of spend there. As we normalize some of the CapEx spend, our entitlement of where our free cash flow is is already getting closer to that number that you described. As we drive more efficiency in the supply chain and as we continue to leverage the business and scale it, we'll get to the next step up to get into that 70-80% range as a company. It is even potential to get better than that over time, I think. Our view is that we're going to continue to invest in the growth of the business. We're going to continue to be disciplined in terms of how we continue to drive profitable growth and let that growth scale into our cash flows. Overall, we feel very much over the next few years that we'll be in that range of the targets that we've laid out and then giving ourselves the opportunity to reinvest in the business and look at a continued M&A agenda to strengthen and shape the company towards our strategic goals. Okay. Thank you for that. Appreciate it. And then just my follow-up. I think in past quarters, you've maybe broken out the growth in extremities between shoulder and foot and ankle. And I think for a few quarters last year, foot and ankle was kind of leading that. Just wondering if you could provide an update there kind of between those two subsegments and extremities. Thanks. Yeah. In the first quarter, definitely our shoulder business drove the extremities growth and we returned to a nice healthy above market there. We feel like our foot and ankle business was above the market growth, but we do think the first quarter in foot and ankle was a little slower market growth than usual. Shoulder drove, foot and ankle still above market, and we still feel comfortable that the combination of those can grow well above market and be a double-digit piece of the overall recon equation. Thank you very much. Our next question comes from Danielle Antalffy with UBS. Danielle, your line is now open. Please go ahead. Thank you so much. Congrats on a great start to the year. Just a quick question for you on the broader macroeconomic environment, if I could. I appreciate all the commentary on tariffs, but one of the questions is, do we, don't we go into a recession? I'm certainly no economist, so I can't opine. Just curious if you could lay out how recession-proof or not you think the business is. I just have one quick follow-up. Yeah. Thanks for the question, Danielle. One of the really great things about the businesses we're in and the markets that we serve is that they have consistent long-term growth and typically have had limited impacts even in significant recessionary periods. I think if you go to some of the worst recessionary periods, maybe the markets we serve kind of went flat. That's something we've studied quite a bit. We feel like our markets should remain healthy. Sure, if there's a recession, there could be some modest impact from some of the discretionary decisions that are made. We would think that in a recessionary period, our markets will perform substantially better than many other markets. Gotcha. Okay. That's helpful. You guys have laid out margin expansion goals annually in the past. I'm just curious if the tariff dynamic changes any of that or if we can still think about about 50 basis points per year as sort of the underlying goal here. Thanks so much. Yeah. I think thanks for the question, Danielle. We are very much still committed to driving that profitable growth and margin expansion. I mean, obviously, the guidance that we updated today would put a little bit of a, I'd say, delay in our approach versus where we expected this year to play out in terms of those goals. As I mentioned in my commentary, we feel this will be more of a one-time thing that we will lap pretty quickly here and get back to momentum as we get into 2026. Overall, fundamentally, the business is set up to drive that profitable growth where we're getting the mix of the business, continued scale from some of the recent acquisitions and further synergies from the Lima acquisition that we did. All of that will contribute to good, strong, profitable growth. We see both opportunities in each segment to drive both gross margin and leverage improvement in each of the business segments. We are still very bullish in terms of our ability to drive good, strong, profitable growth. Now, obviously, 2025, depending on how the tariff situation plays out, might put a little bit of implication on what we can do in year this year. Again, like I said, we will quickly get back to driving margin improvements as we get into 2026. Thank you. Our next question comes from Mike Matson with Needham. Mike, your line is now open. Please go ahead. Hi, guys. This is Joseph on for Mike today. Maybe just to start it off, gross margin, saw some great improvement there. Could you maybe give us some color about maybe why more of that improvement did not flow through to the EBITDA margin? Yeah. I'd say, again, as we are investing in the business for growth, some of the phasing of our operating expense spend, especially as we get off to a strong start with some of the conferences that we attend and some of the medical education events that we invest in, as well as I think we've described a lot of the new products that we're launching, which require some investments as we're really launching those products. Overall, we continue to invest in the business to make sure we're creating sustainable growth momentum. The increases in gross margin are really helping us make those investments while still delivering good, strong profit expansion at the same time. That's the formula that worked in Q1. Overall, I think we've set the business up to continue to be in that kind of momentum. Okay. Great. Maybe just one on the Manafuse launch. Just wondering if you could maybe talk a little bit more about the product and the opportunity here. I mean, should we be thinking about this more as a product cycle upgrade, or are there any features on Manafuse that are very differentiated from either your legacy bone stem products or maybe competitors? Just an add-on to that, have you guys heard anything about potentially reclassifying these devices? Is there any risk to that? I do not think we have heard much about that. That was discussed more in 2020. Yeah. No, thanks for the question. No, Manafuse expands the market and will accelerate the growth of our business there. We serve the spine market with our bone stem, and then we also serve the fracture market as a smaller part of that business. There's still plenty of healthy growth with the traditional technology that we've had in the spine market as well as in fresh fracture in the fracture market. There's also an opportunity that has been emerging with LIPUS ultrasound technology to drive further into the fracture market. The fracture market has the potential to be as large or larger than the spine market. It's just that it's many indications versus spine is less, is just a few. We are really excited that the Manafuse product gives us the opportunity to, within the same channel, get at additional market, in some cases, additional opportunity with the same customers, and in some cases, drive to new customers. It really takes a business that has had maybe more low single-digit market growth rate and moves the market growth rate opportunity for that business above that. It makes our opportunity in our business to be at least mid-single and an opportunity to drive more high single-digit growth within that business within PNR. It is a very high gross margin business with great profitability. As far as the reclass, there is no meaningful discussion going on about reclassifying. I would also say that we believe that if any reclassification did take place, it would actually have the potential to meaningfully accelerate the rate of growth in the business because of the innovation that it would open up and the opportunity to get more market access. While we do not see any reclass on the horizon, we actually believe there's as much opportunity that that could be a good thing as a bad thing if it were to happen. Okay. Great to hear. Congrats on the quarter. Thank you. Thank you. Thank you very much. Just as a reminder, to ask a question, please press star followed by one on your telephone keypad now. When prepping to ask your question, please ensure your device is unmuted locally. Our next question comes from Russell Yuen with William Blair. Russell, your line is now open. Please go ahead. Hey, guys. This is Russell on for Brandon Vasquez. I have two for me. Starting at a more higher level, could you guys talk about what you're seeing in regards to the pricing environment and whether there's any potential for price given any potential inflation or tariffs headwinds? Yeah, sure. On the PNR side, we've talked for a while about a sort of a flatter price environment that emerged after some of the upward pricing post-COVID. We're still in sort of a flattish price environment in PNR, but certainly with various sources of inflation starting to flow through there again. We're going to be kind of looking carefully at that. As far as recon, after a kind of a more stable price environment, there is now a little bit of downward trend in the recon price environment. There's a nice offset there that a lot of the new products are mix enriching. The net effect is pretty decent there. Definitely, we've seen the recon market move into a little bit more of a downward price environment now, but certainly remains to be seen with questions about tariffs and inflation and things as to whether that might shift as we work through this year. Great. Thanks. Then secondly, on the recon side, internationally, you guys grew pretty well, more specifically with cross-selling. Could you guys talk about more on the durability of that and where you're seeing the pockets of strength? Yeah. Our international team has done terrifically. Really, if you look at, we brought those teams together early last year, lots of work to put the channel together, to put the full offering together, etc., and just tremendous growth all through last year, now a tremendous start to this year on top of a strong first quarter last year. Really pleased to see that. Certainly, the markets out there had a good, healthy start, but our growth is definitely above those markets. I think that's a tribute to the strength of our commercial channel out there that we've assembled, the strength of the full product line that we've got, the ability that it gives us country by country to focus on the products that can be grown the most. We are actually in the early days on cross-selling and still growing at the growth rates that we are. As far as your question about durability, I think that, practically speaking, probably those markets are a little stronger than they might be over time. As the markets continue to normalize, we are going to be driving more cross-selling and expand our delta to the markets. We certainly believe that international can play the role they need to play in our overall recon strategic growth. Great. Thank you. Our next question comes from Young Li with Jefferies. Young, your line is now open. Please go ahead. All right. Great. Thanks for taking our questions. Matt, it was great working with you over the past three years, and good to see that you're leaving the company at a strong position and a smooth leadership transition. First question on PNR, pretty good start to the year above guidance performance. You talked about some of the new products driving that. I think the outlook for the year still assumes low single-digit growth. Just kind of curious, the comps get easier through the year. Why sort of the decel for that business? Yeah. Thanks. First, thanks for your comments. I really do believe, as you said, that the company is very strong and has great momentum. I feel very good about the timing here. As far as PNR, yeah, great start. Look, PNR is the part of the company where we need to work through the tariff impacts and try to have maximum mitigation of those impacts. It has also got the most diverse set of end markets and both kind of in terms of indications and customers as well as geographies. While we did have a good strong start there, we think that the appropriate thing to do is to still have the same full-year guidance and work on trying to outperform that, but wait till we see some more of the movie to lock that in. Okay. Very helpful. I guess just on the tariff mitigation efforts, I think you guys called out SKU optimization and rationalization. Can you quantify how much Revs could be impacted? Yeah. We're still working through that, as you can probably imagine, Young, as we're aggressively working on the project plan to shift a lot of those products to other geographies. Now, there are some products that just have smaller margins that we will take advantage of shaping in a more aggressive move this year with regards to our overall end goals of trying to create more growth momentum and mixed advantages within the PNR business. We won't quantify it yet, but as Matt said, in terms of our conservative view, in terms of the guidance right now, has contemplated some of those moves with regards to some SKU trimming and rationalization. We'll continue to work that as we go forward here. All right. Great. Thank you very much. Thank you very much. We currently have no more questions. I will hand back over to Matt for any closing remarks. Thank you. Thank you for joining us this morning. As I said earlier, this will be my last earnings call as the CEO of Enovis, as my successor, Damien McDonald, will take the helm next week on the 12th. I want to take this opportunity to thank each of you for your attention and support of Enovis and its predecessor, Colfax, throughout my tenure. You're in good hands with Damien and Ben and the rest of the team. Thank you for listening in today, and we look forward to sharing our second quarter results with you in early August. Thank you very much, Matt. Thank you for all the speakers on today's line. Thank you, everyone, for joining. You may now disconnect your line.