All right, morning everybody. Thank you so much for joining us here today. My name is Matt O'Brien. I cover med tech here at Piper Sandler. I'm really excited to have Paragon 28 with us. Still my favorite small cap, Albert. Don't, don't forget. We've got Albert down over at the end there. He's the Chairman and CEO of the company. And then we also have Chadi, who's the new CFO of the company. Gents, thanks so much for coming out. Really do appreciate it. Of course. Thanks for having us. Thank you. So, Albert, maybe just talk kinda state of the business at this point and state of the market. Yeah. You guys keep growing at multiples of the overall market. Yeah. You know, first of all, why is the market a little soft? And why are you guys continuing to do so well despite that backdrop? Yeah, well, for starters, I'll just kind of reiterate that the foot and ankle market is still really desperately needing attention, right? We have a lot of indications to address. It's the youngest segment of orthopedics, so it still hasn't had the complete research that we need to improve outcomes. So it's not uncommon for us to have 20%, 30%, 40% complication rates for some of the procedures we do. That sets up perfectly for a company like us who's really solely dedicated to this space. This is all we care about. We eat, sleep, and breathe foot and ankle, and that means that we launch meaningful technology that addresses real needs. We're not making things fancy just to make them fancy. On top of that, I would say that 2024 was an unusual market year, but a phenomenal product launch year for Paragon 28. Probably the strongest year for us in terms of introducing really meaningful technology. So that gave us a great tailwind in a year that I think we saw a lot of exaggerated holiday season. So in Q2 and the beginning of Q3, we saw some we describe it more as choppiness. Some of our counterparts, I think, called it, you know, soft. For us, it was not consistent. It was, you know, kind of bouncing regionally, and then we finished really strong, and Q3 turned out to be a great quarter for us as well. So all of that to say, I think the strength of the products we launched this year gave us a great tailwind, and it made it a little bit, it muted a little bit of what the market was experiencing in terms of maybe some exaggerated vacation season. But all in all, turned out to be a great year for us. Absolutely. Yeah. Absolutely. Okay. I've got a million questions, and sorry to do this to you, Albert, but this is the first time I've gotten to meet Chadi. Yeah. I would say your presence at the company has been pretty active very quickly, to say the very least. So maybe just talk a little bit about, you know, your focus areas within the organization. I think, you know, some of the reductions to pricing, legacy SKUs, to pre-COVID levels. You know, what kind of push are you making there? And then can you get to that point in 2025? So, thank you for having me, Matt. Yes, you know, I was set up for success. Let's put it this way. When I started in August, it was the earnings call for Q2. And Albert and the team set up the priorities for the company to be EBITDA positive in 2025 and cash positive in 2026. And really my job after that has been to make sure that we have the deliverables, and we say what we do and do what we say. And as I learned about the business, the company, the culture, realized very quickly that there was nothing new in these priorities in the sense, it was a back-to-the-future story, where this company has been profitable, prior to going public. And it is just to really remind the organization what it means to be profitable, as a public company. As I went through this, I very quickly realized, and that's what we've announced in Q3 is not only that we were able to be profitable in Q3. We took advantage of the seasonality of our business, but also the team has been doing a lot of work renegotiating prices for our supplies. Yes, we're gonna be EBITDA positive in 2025. We have the actions. We have the commitment of the organization to deliver on this positivity. When it comes specifically to purchases, while the team has done great work in negotiating prices at pre-COVID levels, but we have the inventory that we built during this era that will need to bleed out. And it will take 2025 for that to, and you know, it's between 12 to 18 months for it to bleed out. So we will not see it. We will see it on the cash piece because we're buying at a lesser cost, but we will not see it in the P&L until we sell out the higher prices. So by the end of 2025, early 2026, these products should be completely depleted. Got it. And what about on the OpEx side of things? What are some areas of potential savings that you think the company can generate, you know, next year specifically? Yeah. I know the R&D line is pretty bulletproof for that guy down at the end there. Where else can you make some cuts? Yes. So we, you know, the company, rightly so in my view, built the infrastructure after the IPO, to grow into it. This is, this Paragon is, you know, high teens grower and will continue to be that for the foreseeable future. So it was important to set up the infrastructure to accommodate that growth. Having said that, I think the company realized that maybe we overcomplicated the organization, and that's why we announced the restructuring in force. And we've accomplished that with a reduction of an annualized $8 million, 7% of the headcount. This is behind us now mostly, and as I looked at 2025, and we've done somewhat bottom-up planning, zero-based budgeting when it comes to the cost that we can afford. It was very clear to me that, you know, we have a path, a very robust path to be EBITDA positive in 2025 without, and that's very important, without affecting the growth of the company, and it was really about balancing the growth with innovation while leveraging the rest of the P&L, and it was very obvious to me that we have the base to be able to do that. So that's why I feel very comfortable, you know, supporting the innovation of the company, growing and maintaining the growth that historically this company has while also delivering a profitable growth that is sustainable. Got it. Okay. Appreciate that. Two more for you. And then, Albert, I wanna get back to you with some product questions. But, you know, we saw the leverage here in Q3, in R&D and SG&A. Do you, and then I think you're talking about some pricing improvements that we should see in 2026. Can you guys be a net leverage story for the next two years? So faster top-line growth than your, you know, OpEx or COGS are growing for the next couple of years. Is that the way we should think about you guys? Absolutely. Okay. That's the plan, and we have the actions to deliver on leveraged growth for this company. Okay. Appreciate that. You also made significant progress on the working capital side too. Where do you think AR days from 52 in Q3 can go to? And then the inventory days, and I know this is normal for you know, Ortho. But that's 545 right now. Yeah. Where can that go to? I know some of your bigger competitors are, you know, 200, 300 days. Is that what we should aspire to? Yeah. I think when it comes to the DSO, we are close to best in class. I'm comfortable with 52, around 50 days number. We're not gonna see a lot of improvement there. Really, the biggest room for improvement is inventory. Now, one thing. It is important as we compare ourselves to others in the industry. We, you know, there is a sizable part of our business that somewhat acts like trauma where you need to have the product in the hospital here and there in order for you to capture the surgery. We cannot be as efficient as, you know, the larger joint or the single company product. It's a balancing act. If you ask me where we aspire to do over the long term, and we have to be very careful here, we have to be really intentional, is around the 400 days mark. And the team, and this is under my responsibility as the supply chain, the team is working very hard to you know improve asset allocation so we can deliver on you know sustainable reduction in inventory, especially in the field. Got it. Okay. Appreciate that. Albert, I do wanna get to these new products. Mm-hmm. and really understand what's you've introduced. But can we just talk a little bit on the Q3 performance for a sec? You know, you're drilling down on the domestic business, you know, you had an extra selling day in Q3 and then an easier comp, the easiest comp of the year. So on a two-year stack basis, it looks like a bit of a slowdown, you know, in Q3 domestically. Is that really more market-related, that choppiness that you were talking about, or is there anything competitive to note that you wanna make us aware of? Yeah. Maybe for starters, it's important to point out that we've had a really abnormal two to three years post-COVID. Yeah. You know, and so we're still kind of settling into what our normal seasonality is gonna look like, and the good thing about foot and ankle, it's pretty predictable. This past year was significantly better than the year before, year before, if you remember, was plagued with inventory challenges and, you know, the supply chain world was kind of upside down with some of the EU MDR initiatives there. But all of that to say, I think there was some abnormal holiday season, and the reason I'm pegging that, 'cause I don't have the data to support that, but if I look at the dates that we were choppy, it would match that we had some exaggerated holiday seasons. As kids went back to school, we saw pretty strong recovery from that. Again, the strength of the products we launched. We had a really strong Q1, if you remember. We launched about six new products primarily in the forefoot space. And so the strength of that, when it hit a little bit earlier. Usually it takes six months to a year for a product to start to ramp up. That one really took off pretty quickly. And so it made characterizing what the market was seeing a little bit different, right? It was hard to put our finger on exactly what that was. Okay. All that to say, I felt like we had a great quarter. We added a lot of sales rep headcount. We did an amazing job with those new products, like I mentioned. The productivity was a little bit down, but that's expected as we add new salespeople into the funnel. The productivity number drops down as those people are starting to ramp up as they're in the earlier stages of productivity. So all great leading metrics for us. We feel pretty good that 2025's gonna be strong for us as well. Got it. Okay. So you started talking about those new products. Yeah. I wanna. I know you love all your children, but. Yeah. You know, are there a couple you'd really call out that you think are needle movers that we should really be aware of? And how impactful can they be versus other products that you've launched historically? First of all, you know, that's a dangerous question. I know. I think we've got 12 minutes left. Settle in everyone. So. We've had a really banner year, f orefoot, like I mentioned. So the forefoot space right now is evolving. The procedure type is really shifting to a new type of procedure, smaller incisions, and we happen to be at the perfect place at the perfect time. So those systems did really well for us. We also launched our first Smart module, which has been two years in the making. Really excited about that. With the visibility surgeons have to not only how they're gonna plan to correct these deformities, but what the deformities truly are. And we're seeing it with millimeters of precision, which we didn't have that type of access before. So really exciting products there, but not to sell short the soft tissue products we launched in the fracture fixation space. So we launched a couple of really innovative products to address syndesmotic injuries for ankle fracture. That's an area, again, we're talking about millimeters of perfection, but about a millimeter is the zone where a surgeon needs to correct that area. And the human can't really detect a millimeter of perfection. So we designed a device that actually tells them how much tension they're putting on the gutters of the ankle. That's first of its kind. So it's been really nicely received. So the soft tissue complement, we also launched a fracture fixation nail, fibular fractures. These are, it was originally indicated for patients with really delicate skin where they were compromised and going in with an incision to fix these was a little bit risky. It's turning out that surgeons are getting so comfortable with this type of technique that they're looking at more and more primary type ankle fracture with that, so that nail has rocketed for us, and we just launched that as well, and then this quarter, we just launched a complement to our total ankle franchise. It's a short stem tibia, so it's giving us a little bit more tibial fixation, and these are patients that have a little bit more varus valgus deformity, so it's expanding some of the deformities we can consider in even primary type cases. That's off to a rocket, so we I think we've got 13 cases scheduled this week, so the products we've launched, again, are spread across the full spectrum of foot and ankle, all doing really well, actually exceeding some of our expectations. And then we still have a pipeline of 20 some odd products in development behind that. That's the beauty of the foot and ankle market. We are not bag fillers. We're not here to say we have 26 and you have 24 of something. Yeah. We're really addressing meaningful needs, and that's exciting for us. Okay. And those 20 products, would you expect those 20 more coming out over the next couple of years? Yes. Is that fair? Okay. Yeah. Can you talk a little bit about Smart 28? Yeah. That first module? What is so unique there? 'Cause I can't remember a time where enabling tech came out. Yeah. That didn't accelerate growth for a company. Yeah. The way I characterize it is once you see what you could see with a smart platform like that, it's hard to go back. Yeah. Right? We believe, and we're banking on it, that the future of med device is going to be patient-specific. I don't mean that to sound cliché, but truly understanding the unique deformity pattern that a patient presents with, and then truly understanding how to address that particular patient's deformity needs, is where we think this is going. Smart 28 for us starts with a software platform. So we could take a DICOM image, and we've trained algorithms to read X-rays similar to CTs. Not quite the same level of clarity, but pretty close. We convert that into a three-dimensional model. Then every measurement of every bone in the foot is given to a surgeon within five minutes. So now they're looking at a level of clarity. We can look at joint articulations. We can anticipate soft tissue laxity. We've got all the measurements that are in the literature and described, and it's really giving surgeons visibility to that patient-specific deformity pattern. Got it. And then what we do is we're able to plan that, and we use algorithms to predict what the corrected foot position is gonna be. No offense to some of our counterparts in orthopedics, but if you think about the spine, its vertebrae are all very similar in terms of their characteristic, you know, cervical, thoracic, lumbar. Every bone in the foot is unique. Every bone has a slightly different function. The way they relate to each other, the way the soft tissue components balance and relate creates a really, dynamic, but a really complex structure. And you can start to think that this three-dimensional planning where we can predict what the final foot position is gonna be becomes really influential to, to our surgeons. Got it. Okay. What about next modules coming? Yeah. Coming there. Our goal is, you know, I'd say this type of concept started with total ankle replacement. We've been doing that for years. We're extending that to forefoot right now, but our plan is to address all five subsegments of foot and ankle surgery with this type of technology. So you'll see a stream of modules being introduced. You'll also see layers adding to the existing module. So this forefoot module is not static. It's gonna continue to evolve, one, as we capture more data, but two, as we layer on more and more sophistication to the software, like finite element analysis, modeling, and density mapping, and things that we can really start to add on to give surgeons more and more visibility to that patient's deformity. What does it look like in terms of Smart 28? Are you just giving the system to clinicians? Yeah. I would think of it the same way we've been doing total ankle replacement. So total ankle replacement, we take a CT of the patient's limb, preferably weightbearing. We convert that into a static plan, right? And then once the surgeon dials in exactly what the orientation and position is, then that turns into a patient-specific instrument. So then cut guides and blocks are created from that plan. And there's one charge for that that is, a Maven is what we call our Smart 28 for total ankle. And so I would think of it the very same way where there would be a charge that includes the planning, the intraoperative tools to replicate that plan, all of it included in one charge. So, is that economically beneficial to the company versus just your traditional approach? It works great. I mean, software is different, right? I don't have to hear him complaining about CapEx and some of the more traditional pieces. And by the way, I was listening to you asking Chadi questions, and I'm still so thrilled to have him on board. I don't wanna get mushy here, but I just love the way he thinks about the world. And so it's really nice having him here. But all that to say, we're now. We're always a hardware company, but we're becoming a software company that delivers hardware. Got it. And that's the way we're trying to retrain the entire organization. It's not always easy to change a paradigm like that, but we're in the middle of it, and it's exciting. Okay. Okay. Appreciate that. Yep. Just back to your domestic business for a second. And you may be able to answer this question with all the new products, but, you know, 9% growth in new surgeons, nearly 11% growth in new reps. But the productivity per rep was only up about 4%. Yeah. Is there a reason for that? And can all these new products accelerate that metric specifically in 2025? Yeah, absolutely. That's the phenomenon that I was mentioning where, when a new rep enters into the funnel of a producing rep, they start at a lower revenue piece. So their sales are much lower than maybe the average was. So as we enter new heads into that count, it's not uncommon for us to see the productivity dip, right? 'Cause now we're blending that across a lower entry point. As those reps become more and more productive, we start to see that elevate. I think our average right now for a producing rep is just sub $700,000 a year, and we would expect to see a lot of influence with the products there, with the medical education that we do, as these reps go up, but that is a great leading indicator for us when we're adding new producing reps into the funnel. That's a good leading indicator for our business. Okay. Chadi, where do you think that $700K can go per rep over time? Can it get to a $1 million, $1.2 million? I mean, where can, where can that top out? You know, we're gonna continue to expand. I think when I look at where we are in the U.S., I think we have a big runway when it comes to, you know, geographically where we wanna be and sales per doctor where we're gonna be. So, you know, while the aspiration is our best reps to be at that number, I think we're gonna continue to feed it. And therefore, it will put pressure on that average. So I'm not as much looking at that average per se as looking at what is our, you know, kind of open store after one year or after two years. Our rep after one year or two years should be able to deliver on that number. That is more important to me than the average of all the reps. Got it. Okay. And there's nothing that gives you any pause to that trajectory of the reps that have been on board for a little while? We're still, I think, as Albert said, we're still in the early innings of addressing foot and ankle complications. So the runway of the company is right, and we have a long runway to go. Understood. What about the international business? That was particularly strong in Q3, and it's been really good for years now. What's driving that growth? Is it new territories or expanding existing? I know you're gonna say both, but if you had to really point to one, what's really driving that? So, you know, I have a special affinity with the international market. I grew up in these international markets. I was responsible at Smith & Nephew for the international market. So I have a good understanding of sustainability and profitability of these markets. And we've definitely been looking at these markets to make sure that we go deep versus wide. And that's why we prioritized, you know, the regions where we are strong, like the U.K., like South Africa, like Australia, like Canada, Spain. And it was intentional to mention them because we want sustainable, profitable growth. And we're only gonna be able to do that if we go deeper in the market where we have the infrastructure to win and the right to win. The growth is coming from really focusing on these markets where we have, you know, a strong position and we can get stronger by going deeper into the market. Got it. Okay. And I don't wanna. I'm not trying to have a gotcha moment here. I just wanna make sure we're clear on this, and I don't want Matt to get upset with me either. But I think you said earlier, you know, you expect to be a kind of a high teens grower going forward. I think the Street's modeling more like low to mid teens. Is that just kinda where the Street should be thinking about things for next year, kinda low to mid teens? And then hopefully with all these new products and productivity, you do better than that? So I think what we're trying to say is we need to reset the narrative. Our aspiration is to be high teens, but our commitment is to grow sustainably and profitably. And it is the balancing act of what we aspire to be versus what we can be and what we can commit to be. Got it. Okay? So that's the difference in these two statements. Okay. Okay. Appreciate that. As I look at the time here, I think we're just about out of it. We'll go ahead and wrap it up there. Chadi, Albert, thank you so much for all the time. Thank you. Thank you, Matt. Appreciate it. Thank you.